Hi, i am practicing basic NK model with some applications using dynare.
And i found some wonderful examples by prof. JohannesPfeifer and using these to study.
But when i used this(link below) and put some constant terms, the program doesn’t work, saying
“No steady state for your model could be found”
For example, i put rho(= -logbeta) in the natural interest rate and in the interest rate rule. And i also put log(1-a) -mup in natural wage as explained in the book of Gali Ch6.(*)
I already used resid(1) and noticed that steady state value = / 0
But as far as i know, the steady state value doesn’t have to be exact 0. It suffices to be near 0.
It worked when i run the basic NK model(with sticky price and without sticky wage) but not when i added sticky wage.
Could someone explain how can i use dynare with that specification(*) as in the book?
https://github.com/JohannesPfeifer/DSGE_mod/blob/master/Gali_2015/Gali_2015_chapter_6.mod