Hello,everyone!
this is another version of my last code,it contains homogeneous firms.(so it is a simpler one) . I have run the last code sucessfully, but failed in this code.
The error message is :"Warning: Matrix is singular to working precision. "
Could anyone help me ? Thank you in advance!
onlybs.mod (3.57 KB)
model_diagnostics says
[quote]MODEL_DIAGNOSTICS: The Jacobian of the static model is singular
MODEL_DIAGNOSTICS: there is 1 colinear relationships between the variables and the equations
Colinear variables:
G
T
Colinear equations
1 2 3 4 6 7 8 9 10 11 12 13 14 15 17 18 19 20 21 22 23 24 25 26 27 28 29
MODEL_DIAGNOSTICS: The presence of a singularity problem typically indicates that there is one
MODEL_DIAGNOSTICS: redundant equation entered in the model block, while another non-redundant equation
MODEL_DIAGNOSTICS: is missing. The problem often derives from Walras Law.[/quote]
My hunch is that Ricardian equivalence holds in your model so that debt and lump sum taxation are equivalent, but your are trying to determine them separately.