I am quite new to Dynare. I would like to code up the following:
v_t = s_t-sbar-Omega if s_t > sbar+Omega. Otherwise (i.e. if s_t <= sbar+Omega) v_t should be zero.
What I tried in the Dynare model block is
- v = max(0, (s-sbar-Omega));
- v= (s>(sbar+Omega))*(s-sbar-Omega);
However both do not seem to do what I need. While the first suggestion yields also negative values for v_t, the second suggestion is always zero.
Could anybody help me on this issue? Many thanks in advance.
Are you doing stochastic simulations or perfect foresight?
Currently I am trying stochastic simulation.
That’s the problem with linearizations:
So, did I get it correctly that what I would like to do does not work, at least no when doing stochastic simulation (what is with perfect foresight?)?
Would it then be possible to have something like
if x> some threshold, y=f(x) and otherwise if x< some threshold, y=g(x), with f(x) and g(x) being different?
It depends on the context. You could use a piecewise linear solution (OccBin) or perfect foresight simulation with mcp-tags.
Thank you so much for your help