No steady state and NO IRF RESULTS

1)The steady states values are NAN.
2)Also, no Impulse Response Function (IRF) results available after processing.

apica.mod (4.2 KB)

Please help
1)The steady states values are NAN.
2)Also, no Impulse Response Function (IRF) results available after processing.apica.mod (4.2 KB)

Warning: Matrix is singular to working precision.

In evaluate_steady_state (line 261)
In steady_ (line 55)
In steady (line 80)
In apica.driver (line 840)
In dynare (line 293)

Residuals of the static equations:

Equation number 1 : NaN : r
Equation number 2 : NaN : rhouse
Equation number 3 : NaN : rfirm
Equation number 4 : NaN : reer
Equation number 5 : NaN : CRP
Equation number 6 : NaN : AD
Equation number 7 : NaN : consump
Equation number 8 : NaN : inv
Equation number 9 : NaN : x
Equation number 10 : NaN : m
Equation number 11 : NaN : inflation
Equation number 12 : NaN : ulc
Equation number 13 : NaN : w
Equation number 14 : NaN : n
Equation number 15 : NaN : unemp
Equation number 16 : NaN : capul
Equation number 17 : NaN : rpinv
Equation number 18 : NaN : E_INFLATION
Equation number 19 : NaN : past_inv
Equation number 20 : NaN : E_REER
Equation number 21 : NaN : L_gdp
Equation number 22 : NaN : L_nfa
Equation number 23 : NaN : infl_tar
Equation number 24 : NaN : rworld
Equation number 25 : NaN : infworldexp
Equation number 26 : NaN : govcons
Equation number 27 : NaN : houseinc
Equation number 28 : NaN : Labour
Equation number 29 : NaN : Long_unemp
Equation number 30 : NaN : vix

Error using print_info (line 32)
The steady state has NaNs or Inf.

Error in steady (line 102)
print_info(info,options_.noprint, options_);

Error in apica.driver (line 840)
steady;

Error in dynare (line 293)
evalin(‘base’,[fname ‘.driver’]) ;

Hello, without looking much in detail, I see that your last AR(1) shock equation has no persistence parameter. Also, I am not sure what you seek when defining the infl_tar=3 as a variable when you can use as parameter. I hope it helps.

Thank you for the response. However , post the changes, pre-processing failed. apica.mod (4.2 KB)

dynare apica.mod
Using 64-bit preprocessor
Starting Dynare (version 4.6.1).
Calling Dynare with arguments: none
Starting preprocessing of the model file …
WARNING: A parameter was used with a lead or a lag in the model block
Error: dynare not used in the model block

Error using dynare (line 282)
Dynare: preprocessing failed

if status
% Should not use “error(result)” since message will be truncated if too long
error(‘Dynare: preprocessing failed’

Hello, the warning message says that a parameter was used with a lead or a lag. I guess that you changed infl_tar as a parameter, but you kept the (+1) and (-1) in the equations.

Thank you for responding. However, still the error persists. apica.mod (4.2 KB)

dynare apica.mod
Using 64-bit preprocessor
Starting Dynare (version 4.6.1).
Calling Dynare with arguments: none
Starting preprocessing of the model file …
Error: dynare not used in the model block

Error using dynare (line 282)
Dynare: preprocessing failed

Please help . Made the changes that you recommended.

dynare apica.mod
Using 64-bit preprocessor
Starting Dynare (version 4.6.1).
Calling Dynare with arguments: none
Starting preprocessing of the model file …
Error: dynare not used in the model block

Error using dynare (line 282)
Dynare: preprocessing failed

Always post the full error message. In your case, it says that the variable dynare is not used in the model block. You can check that you define a variable with that name.

Hello,

  1. You didn’t give a value to rho_vix.
  2. There is a variable called dynare that you don’t use in the model block.
    Best, FgB

Thank you. I couldn’t understand your point number 2. I haven’t used any variable named “dynare” in the model block.

Defining a variable with the name dynare? I really don’t understand.

What we, Johannes and I mean, is that in your variables block just at the beginning of your MOD file, you have a variable called dynare, I think it was a typo you made, search for it and delete it, and add a value to the rho_vix, that would make it work.

Thank you so much. It worked .
Grateful to you and Johannes.

Shall ask more queries as and when they arise in future.

Regards

1 Like

if i want to keep inflation expectations as exogenous this time, what changes should i make in the model. please suggest . Thank you.

If it is not a parameter anymore, then it has to be included in the var or varexo blocks. Another option is to not include it neither in the var nor varexo blocks but inside the model block as a model-local variable with # before the expression that defines the variable (page 27 of the Dynare Manual).

Thank you so much for responding. Shall work on this and get back soon for further help.

Regards

You should not approach this from a technical perspective, but from an economic one. What you are asking is inconsistent with rational expectations modeling.

Thank You Sir for discussing and replying. I understand the economic perspective of it but I have to determine the role played by only the expectations part in the economy. I will determine that by analyzing the difference between the rational expectations consistent model and this one.

Please keep guiding me with the exogenous expectations part like you did in the previous model. Extremely grateful for your guidance.

Regards

Your model should contain the contemporaneous variables and the expectations. You should be able to abitrarily specify the expectations part (of course subject to the BK conditions still being satisfied)