Hello,

I have been working on an Over-lapping Generations model with three generations and stochastic shocks.

I have struggled while writing the dynare code because of the timing setup and the fact that I have 3 generations optimising each period. So, I came up with a way to write the Euler equations for generations 1 and 2, which is the following:

code = cbeta*rho1*(R(+1)/(1 + g))*(cxi/c2(+1));

(cxi/c2) = cbeta*rho2*(R(+1)/(1 + g))*(cxi/c3(+1));

[/code]

Being c1, c2(+1) and c3(+2) the consumption of generation 1, 2 and 3 in period 0, 1 and 2.

Im worried that my code could not be optimising for the entire time horizon of an agent (3 periods) but instead in a staggered way.

This has been the only way in which I have fulfilled the Blanchard Kahn Conditions.

Thanks beforehand for all the help.