MODEL_DIAGNOSTICS: The steady state cannot be computed

Andrew · March 20, 2020, 12:58pm

Deal all,
I’m trying to sovle my DSGE modle,
but I got an error message:
“Impossible to find the steady state. Either the model doesn’t have a steady state, there are an infinity of steady states, or the guess values are too far from the solution.”

Also, it printed:
“DYNARE_SOLVE (solve_algo=2|4): number of blocks = 3
DYNARE_SOLVE (solve_algo=2|4): solving block 2, of size 1
DYNARE_SOLVE (solve_algo=2|4): solving block 1, of size 93
DYNARE_SOLVE (solve_algo=2|4): number of blocks = 3
DYNARE_SOLVE (solve_algo=2|4): solving block 2, of size 1
DYNARE_SOLVE (solve_algo=2|4): solving block 1, of size 93
MODEL_DIAGNOSTICS: The steady state cannot be computed”

The Residuals of the static equations are very close to ‘0’. I want to figure out why it happened and how to solve the problem.
rer_soe.mod (18.0 KB)

Residuals of the static equations:

Equation number 1 : -1.9163e-05
Equation number 2 : 7.8292e-06
Equation number 3 : 1.1659e-06
Equation number 4 : 8.5084e-05
Equation number 5 : -1.63e-06
Equation number 6 : 6.805e-06
Equation number 7 : -4.7121e-06
Equation number 8 : 6e-06
Equation number 9 : 1.4e-06
Equation number 10 : -2.2621e-05
Equation number 11 : -2.1981e-05
Equation number 12 : -1.6721e-05
Equation number 13 : -1.8481e-05
Equation number 14 : -0.00023562
Equation number 15 : -8.4282e-05
Equation number 16 : 2.604e-06
Equation number 17 : 1.89e-06
Equation number 18 : 0
Equation number 19 : 1.424e-06
Equation number 20 : 0
Equation number 21 : 0
Equation number 22 : 0
Equation number 23 : 0
Equation number 24 : 0
Equation number 25 : -6.842e-06
Equation number 26 : 0
Equation number 27 : 3.66e-06
Equation number 28 : -1.396e-05
Equation number 29 : 4.2618e-06
Equation number 30 : -2.8686e-05
Equation number 31 : -2.4734e-05
Equation number 32 : 1.4892e-05
Equation number 33 : 1.138e-05
Equation number 34 : 1e-05
Equation number 35 : -9.2e-06
Equation number 36 : -1.3842e-06
Equation number 37 : 0.00047476
Equation number 38 : 0.153
Equation number 39 : 0.21038
Equation number 40 : -0.08032
Equation number 41 : -0.058412
Equation number 42 : 0
Equation number 43 : 0
Equation number 44 : 0
Equation number 45 : 0
Equation number 46 : 0
Equation number 47 : -1.937e-05
Equation number 48 : -0.071319
Equation number 49 : -0.0011554
Equation number 50 : 1.46e-07
Equation number 51 : -2.7e-06
Equation number 52 : -2.1416e-06
Equation number 53 : 5.178e-06
Equation number 54 : -1.124e-06
Equation number 55 : 3.776e-06
Equation number 56 : -6.368e-07
Equation number 57 : -1.058e-06
Equation number 58 : 0
Equation number 59 : 0
Equation number 60 : -3.5867e-05
Equation number 61 : -1.1313e-05
Equation number 62 : 2.1039e-05
Equation number 63 : -0.37944
Equation number 64 : 1.2e-06
Equation number 65 : 9.1331e-06
Equation number 66 : 1.4674e-05
Equation number 67 : -1.5037e-05
Equation number 68 : -6.2769e-05
Equation number 69 : -4.0176e-07
Equation number 70 : 9.1342e-06
Equation number 71 : -3e-06
Equation number 72 : 0
Equation number 73 : -0.05949
Equation number 74 : 5e-07
Equation number 75 : -0.051031
Equation number 76 : 7.1328e-07
Equation number 77 : 5.1933e-06
Equation number 78 : 2.9772e-06
Equation number 79 : -1.3428e-06
Equation number 80 : 2.8488e-06
Equation number 81 : 1.2371e-06
Equation number 82 : -3.0584e-06
Equation number 83 : -2.3e-07
Equation number 84 : -2.2872e-06
Equation number 85 : 8.064e-07
Equation number 86 : 0
Equation number 87 : 0
Equation number 88 : 0
Equation number 89 : 0
Equation number 90 : -5.5492e-06
Equation number 91 : -4.886e-05
Equation number 92 : 1.1835e-06
Equation number 93 : 2.1976e-05
Equation number 94 : -1e-06

Residuals of the static equations:

Equation number 1 : -0.00011769
Equation number 2 : -0.0044692
Equation number 3 : -0.00059421
Equation number 4 : -0.0003585
Equation number 5 : 0.00048297
Equation number 6 : -0.0031748
Equation number 7 : 0.0030894
Equation number 8 : -4.7471e-05
Equation number 9 : -0.00036837
Equation number 10 : -0.0012822
Equation number 11 : -0.00090636
Equation number 12 : -0.0018829
Equation number 13 : -0.0007535
Equation number 14 : 0.00013113
Equation number 15 : 0.00025525
Equation number 16 : -0.0006328
Equation number 17 : -0.00086513
Equation number 18 : -0.00087642
Equation number 19 : -0.00045953
Equation number 20 : 2.679e-05
Equation number 21 : -2.1073e-05
Equation number 22 : -2.5765e-05
Equation number 23 : -9.4343e-06
Equation number 24 : 0.0054705
Equation number 25 : 0.00015794
Equation number 26 : -0.0017718
Equation number 27 : 0.0017223
Equation number 28 : 0.00055167
Equation number 29 : -6.8432e-05
Equation number 30 : 0.0055411
Equation number 31 : 0.0022542
Equation number 32 : -0.0013025
Equation number 33 : -0.0003495
Equation number 34 : -5.3985e-05
Equation number 35 : -0.00037759
Equation number 36 : 0.00090119
Equation number 37 : 0.00014442
Equation number 38 : 0.0014822
Equation number 39 : 0.0039719
Equation number 40 : -0.00096181
Equation number 41 : -0.00022409
Equation number 42 : -0.0001033
Equation number 43 : 0.00023758
Equation number 44 : 4.2179e-06
Equation number 45 : 1.3474e-05
Equation number 46 : 0.015589
Equation number 47 : -0.00099127
Equation number 48 : 0.028291
Equation number 49 : 7.7603e-06
Equation number 50 : 0.00078334
Equation number 51 : 0.0032211
Equation number 52 : -0.00042003
Equation number 53 : -0.00012953
Equation number 54 : -0.012304
Equation number 55 : 0.011876
Equation number 56 : 0.0030611
Equation number 57 : -0.00072316
Equation number 58 : -0.00042507
Equation number 59 : -3.7328e-05
Equation number 60 : -0.0072252
Equation number 61 : 0.014561
Equation number 62 : 0.0027968
Equation number 63 : -0.0073282
Equation number 64 : -0.0042953
Equation number 65 : -0.0090568
Equation number 66 : 0.00086158
Equation number 67 : 0.00053833
Equation number 68 : 0.00059798
Equation number 69 : -0.00054957
Equation number 70 : 0.0001577
Equation number 71 : -0.0066441
Equation number 72 : -0.012801
Equation number 73 : -0.0064951
Equation number 74 : -0.0097198
Equation number 75 : -0.015973
Equation number 76 : -0.00035231
Equation number 77 : -0.0028712
Equation number 78 : -0.0014096
Equation number 79 : -0.0008735
Equation number 80 : 0.0027718
Equation number 81 : 0.0040776
Equation number 82 : -0.00084152
Equation number 83 : 0.0002176
Equation number 84 : -0.00025285
Equation number 85 : -0.00014455
Equation number 86 : 0.00033463
Equation number 87 : -0.00019462
Equation number 88 : 0.00019322
Equation number 89 : -0.00018862
Equation number 90 : 0.00076858
Equation number 91 : -0.0010922
Equation number 92 : 0.0041376
Equation number 93 : -0.00031387
Equation number 94 : 0

jpfeifer · March 20, 2020, 2:08pm

Are you sure your model has a unique steady state, i.e. not unit root?

Andrew · March 20, 2020, 2:26pm

Thank you for your reply!
I used ‘fsovle’ to get the steady state value. It seems “normal”.
In fact, I’m not sure if it has a unique steady state or unit root. How could I know that?
If there are many steady states, it means my model is wrong? How should I solve this problem?
Could this be other reasons?

Andrew · March 21, 2020, 2:42am

Dear jpfeifer,
I modified my SVAR model in mod file, it seems has a steady state. But when I run the mod file, I got another error warning:
"There are 35 eigenvalue(s) larger than 1 in modulus
for 32 forward-looking variable(s)

The rank condition ISN’T verified!
Blanchard Kahn conditions are not satisfied: no stable
equilibrium"

I don’t know what to do. Help!

WHATS MORE, if I change my parameters’ value, I get the warning:“Impossible to find the steady state. Either the model doesn’t have a steady state, there are an infinity of steady states, or the guess values are too far from the solution.” again!

Here is my new modfile:rer_soe_1.mod (18.0 KB)

Thanks for your help again.