# Model with durable good - rank condition ISN'T verified

**URL:** https://forum.dynare.org/t/model-with-durable-good-rank-condition-isnt-verified/15049
**Category:** General DSGE Modeling
**Created:** [20 January 2020 19:13 UTC](https://forum.dynare.org/t/model-with-durable-good-rank-condition-isnt-verified/15049 "2020-01-20T19:13:05Z")
**Posts on this page:** 1
**Showing post:** 5

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### Author: ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)
#### Post date: [28 January 2020 13:32 UTC](https://forum.dynare.org/t/model-with-durable-good-rank-condition-isnt-verified/15049/5 "2020-01-28T13:32:35Z")

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1. Without knowing the model in more detail it is impossible to tell. What you describe sounds sensible, but in the end depends on your numeraire, i.e. in which currency/units you want to express it.
2. Such a behavior is not unusual with jump variables, so I am not too surprised.
3. Yes, your model provides linear deviations. I would not go for a full substitution. See

> [@Question about understanding irfs in dynare](https://forum.dynare.org/t/question-about-understanding-irfs-in-dynare/10622/4):
>
> To be more precise: it depends on how the variables in your model are measured. As @stepan-a says, Dynare conducts a linearization. If you for example have a nonlinear model and your model variable is simply the level of output, the IRF will measure the difference between the variable and its steady state (or its mean at higher order). This is the case with [https://github.com/DynareTeam/dynare/blob/master/examples/example1.mod](https://github.com/DynareTeam/dynare/blob/master/examples/example1.mod) In contrast, if your model variable already measures percentage…

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