Hi everyone
I am a student from the University of Berlin and I am currently working on replicating Galí (2007) article “Understanding the effects of government spending”.
Where I struggle is to log-linearize equation (5) describing the dynamics of Tobins-Q:
with the resulting log-linearized equation being (23) in the image.
The other equations are straightforward to log-linearize, but this particular one I struggle with. Any guidance in the right direction is much appreciated.
Peter.
That should be straightforward. How far did you get, i.e. where is the problem?
Hi Johannes
First of all, thanks for offering your help. After hours of trial-and-error I finally managed to get it right. My problem was getting the right value of R^k, and Iuckily I found the steady state value herefor in the appendix. So I suppose the lesson is always to pay attention to details. 
Peter L.
Hi @peter_l
Me and my Bachelor mate are also currently stuck at this linearisation. At the moment I don’t have any clue how even to begin as nothing has made sense to this point. Would you be willing to share the derivation with us?
Hi Johannes
I am currently sitting with the same problem as Peter did (but with time-varying depreciation), and I have not been able to find the steps of the log-linearization of Q anywhere.
Any chance you can help?
Dear Johannes
Unfortunately, I am sitting with the same problem and would love to see the derivations to the log-linearization of Tobin’s Q.
Hoping to hear from you
Hi 
We try and understand how to obtain equation (23) from (5) i.e. the log-linearization of equation (5)
Can you by any chance help?
Equation 5 did not Log-linearized in that initial form.
You can work on it and transfer it to a different simpler equation for Tobin’s Q and after this step you can linear that equation by Uhlig’s method.
