Hello. I am trying to run a third order approximation in dynare but there is an error which tells that “ERROR USING SPARSE. OUT OF MEMORY”. He also tells that there is a problem in “dynamic” file which dynare creates when makes stochastic simulation.

It seems that the sparse matrix is very large and dynare cannot solve it. My question is how I can overcome this problem. Maybe there is some option which enables to extend the sparse matrix dimension ?

Many Thanks

Use a computer with a 64bit OS and more memory. There is no way to circumvent Matlab needing a lot of memory for big matrices.