Dear Michel,

One more question about osr in Dynare and under a non-linearized model. Searching for the optimal parameters in the rule

**Rule 1:** i = -(1-para_i)*log(beta) + para_i*i(-1) + (1-para_i)*para_y*ygap + (1- para_i)*para_pie*inflation

returns a value para_i smaller then, but very close to 1. Consequently, the overall weight on output and inflation goes to zero (the values of para_pie and para_y are around 2 and 1 respectively).

Now using the rule

**Rule 2:** i = -(1-para_i)*log(beta) + para_i*i(-1) + para_y*ygap + para_pie*inflation

i.e. para_pie instead of (1-para_i)*para_pie and para_y instead of (1-para_i)*para_y returns the error message for non-convergence:

**??? Error using ==> steady_
STEADY: convergence problems**

I cannot see where the difference comes from, i.e. why osr has problems with rule 2 but not rule 1. I did even scale the initial parameter values in rule 2 so that the overall coefficients on inflation and the output gap are identical in both rules.

The non-convergence message for rule 2 even appears if I fix the parameter for interest rate persistence, para_i, to say 0.9 and than optimize over para_pie and para_y only.

*Do you have any idea, where this difference between in principle identical rules may come from?*

Many thanks!

Lukas