while solving and simulating a New Keynesian open economy DSGE with incomplete pass-through,
I obtained a multiple of warnings that reads as follows:
""Warning: Matrix is close to singular or badly scaled.
Results may be inaccurate. RCOND = 1.150177e-017.
In th_autocovariances at 182
In disp_th_moments at 37
In stoch_simul at 73
In Sisay_OENK at 345
In dynare at 132"".
What should I do to overcome this problem? I attached the .mod file.
Any tip is highly appreciated.
(BTW, I obtained a solution to my previous query from a an earlier response posted by jpfeifer Oct 4/2010).
With best regards,
Small Open economy NK.mod (4.57 KB)