Hi,

I wanted to thank you for answering my post earlier his month. It worked perfectly once I followed your advice.

I am continuing to run Bayesian Estimation for my model and have run into another issue which I would appreciate some guidance on.

It seems that when I try an estimate one of the parameters in particular I generate the following error message:

"??? Error using ==> chol

Matrix must be positive definite.

Error in ==> metropolis_hastings_initialization at 52

d = chol(vv);

Error in ==> random_walk_metropolis_hastings at 43

ix2, ilogpo2, ModelName, MhDirectoryName, fblck, fline, npar, nblck, nruns, NewFile, MAX_nruns, d ]

= …

Error in ==> dynare_estimation_1 at 940

feval(options_.posterior_sampling_method,‘DsgeLikelihood’,options_.proposal_distribution,xparam1,invhess,bounds,gend,data);

Error in ==> dynare_estimation at 62

dynare_estimation_1(var_list,varargin{:});

Error in ==> bank_model_2009_bayes_7 at 524

dynare_estimation(var_list_);

Error in ==> dynare at 102

evalin(‘base’,fname) ;"

I was wondering if I could get some information on what this message is relating to. For instance which matrix is being referred to? Is it the var-cov matrix used for drawing parameters from the distributon during the MH iterations? Is this something that usually happens, i.e. even though the model solves with the given value of a parameter, once you try and estimate this parameter (using the same initial value as a prior) then the Bayesian estimation can break down?

I hope my questions make sense, and any guidance on what could be causing this error would be much appreciated.

Kind regards,

Aqib