Do you know whether Dynare is capable of solving DSGE model with portfolio choice, like those in Tille and Wincoop (2007) “International Capital Flows”, Devereux and Sutherland (2008) “Country portfolios in open economy macro models”?
Any reference will be highly appreciated!
You have to solve your model at third-order.
I guess you should use dynare ++or dynare 4.1 or later
Currently Dynare is not able to solve this class of models out of the box.
It is however possible to use Dynare within a more complex framework to solve these models, some people are doing it, in particular Pablo Winant (search the web for his contact information).