Hello,

I am trying to build the kind of NK model, and I would like to change the monetary-policy equations. Specifically, I am interested mainly in the difference between the growth rate and the level targeting. Unfortunately, the model goes only when considering the price level target. When I try to switch to the inflation target, it does not find the steady-state. The same holds also for the nominal GDP growth target, and also for the nominal GDP level target.

However, when I run my model without exp(x) definition, i.e. only in linearized form, it does work with all of the rules. Frankly, I am not aware of where can be the problem. Hence, I would really appreciate any help or advice.

The models are attached below.

rules_log_lin.mod (12.4 KB)

rules_lin.mod (8.7 KB)

Thanks a lot in advance!

F.