I’m trying to compute the unconditional welfare. However, it turned out that the stochastic mean of unconditional welfare is larger than its deterministic steady state. Then I found something more strange.
In the mod file fabur.mod (753 Bytes)
, an exogenous shock
VarPhi follows the rule
log(VarPhi) = (1-0.9)*log(1) + 0.9*log(VarPhi(-1)) + Eps_phi;
Here are four strange things…
- The steady state of VarPhi is 1, while in oo_.mean the value is 1.026.
- After I changed
- Eps_phi, the result was the same.
- After I changed the rule into
VarPhi = (1-0.9)*log(1) + 0.9*VarPhi(-1) - Eps_phiwhere the steady state is zero now, oo_.mean is still larger than zero.
- After I raised the variance of Eps_phi, oo_.mean got even larger.
Anyone can explain the above facts? Or how can I fix it?
fabur.mod (753 Bytes)