Hello, I hope to find the problems of following codes.
I try to put some asset pricing issues at model in ‘example1.mod’ that included in a initial dynare subfile.
With this intention, I input some codes as follows.
Thus, I add ‘p’, ‘p = beta*(c/c(+1))*(p(+1)+y(+1))’, and ‘p = 1’
----------------------------------------------------------------------
var y, c, k, a, h, b, p;
varexo e, u;
parameters beta, rho, alpha, delta, theta, psi, tau;
alpha = 0.36;
rho = 0.95;
tau = 0.025;
beta = 0.99;
delta = 0.025;
psi = 0;
theta = 2.95;
phi = 0.1;
model;
cthetah^(1+psi)=(1-alpha)y;
k = beta(((exp(b)c)/(exp(b(+1))c(+1)))
(exp(b(+1))alphay(+1)+(1-delta)k));
y = exp(a)(k(-1)^alpha)(h^(1-alpha));
k = exp(b)(y-c)+(1-delta)k(-1);
a = rhoa(-1)+taub(-1) + e;
b = taua(-1)+rhob(-1) + u;
p = beta(c/c(+1))*(p(+1)+y(+1));*
end;
initval;
y = 1.08068253095672;
c = 0.80359242014163;
h = 0.29175631001732;
k = 11.08360443260358;
a = 0;
b = 0;
e = 0;
u = 0;
p = 1;
end;
shocks;
var e; stderr 0.009;
var u; stderr 0.009;
var e, u = phi0.0090.009;
end;
stoch_simul;
---------------------------------------------------------------------
But the result is,
----------------------------------------------------------------------
Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
Starting Dynare (version 4.2.0).
Starting preprocessing of the model file …
ERROR: example1.mod:48.5-37: To use an external function within the model block, you must first declare it via the external_function() statement.
??? Error using ==> dynare at 126
DYNARE: preprocessing failed
--------------------------------------------------------------------------
Unfortunately, I cannot understand what the message, ‘To use an external~’, means.
Would you please let me know what went wrong? Thank you.