Hi, I’m currently working on the model by Kirchner & Van Wijnbergen (2016), and I intend to adapt it to the context of epidemics/Covid-19 for which I have included an external process from Acurio-Vasconez (2021) that exogenously determines the labor supply. Hence, the model is deterministic and is solved w/ perfect foresight. I’ve solved the steady-state analytically and followed the original code closely, yet somehow this problem keeps occurring. I’ve double-checked the equations and can’t seem to find anything wrong.
Warning: Matrix is singular to working precision.
In sim1_linear (line 199)
In perfect_foresight_solver_core (line 97)
In perfect_foresight_solver (line 63)
In Dynare_forum.driver (line 873)
In dynare (line 293)
Simulation terminated with NaN or Inf in the residuals or endogenous variables.
There is most likely something wrong with your model. Try model_diagnostics or another simulation method.
Here’s the .mod file
Dynare_forum.mod (11.8 KB)