# Parameter introduction

**URL:** <https://forum.dynare.org/t/parameter-introduction/13088>\
**Category:** General DSGE Modeling\
**Created:** [13 January 2019 18:56 UTC](https://forum.dynare.org/t/parameter-introduction/13088 "2019-01-13T18:56:55Z")\
**Posts on this page:** 5\
**Page:** 1

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**Author:** ![mohsen](https://forum.dynare.org/letter_avatar_proxy/v4/letter/m/8491ac/32.png) [@mohsen](https://forum.dynare.org/u/mohsen)\
**Post date:** [13 January 2019 18:56 UTC](https://forum.dynare.org/t/parameter-introduction/13088/1 "2019-01-13T18:56:55Z")

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Hello. In my model, the variance of one of the model’s endogenous variables is parameter. How can I introduce this variance as a parameter?

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**Author:** ![mohsen](https://forum.dynare.org/letter_avatar_proxy/v4/letter/m/8491ac/32.png) [@mohsen](https://forum.dynare.org/u/mohsen)\
**Post date:** [16 January 2019 20:22 UTC](https://forum.dynare.org/t/parameter-introduction/13088/2 "2019-01-16T20:22:11Z")

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Can someone help me?

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**Author:** ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)\
**Post date:** [18 January 2019 06:06 UTC](https://forum.dynare.org/t/parameter-introduction/13088/3 "2019-01-18T06:06:53Z")

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That statement does not make sense. If it’s an endogenous object, then it will completely depend on the exogenous objects of the model. If you want to fix something like the variance of that endogenous object, you need to make something else endogenous. An example of this is fixing the steady state of hours worked by setting the labor disutility parameter accordingly.

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<div class="post-metadata">

**Author:** ![mohsen](https://forum.dynare.org/letter_avatar_proxy/v4/letter/m/8491ac/32.png) [@mohsen](https://forum.dynare.org/u/mohsen)\
**Post date:** [1 February 2019 18:57 UTC](https://forum.dynare.org/t/parameter-introduction/13088/4 "2019-02-01T18:57:08Z")

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If we want to introduce the variance of an exogenous variable as a parameter, how do we do it?

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**Author:** ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)\
**Post date:** [2 February 2019 09:05 UTC](https://forum.dynare.org/t/parameter-introduction/13088/5 "2019-02-02T09:05:06Z")

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You can use

```auto
parameters sig_e;

varexo epsilon;

sig_e=0.01;

model;
...+sig_e*epsilon
end;

shocks;
var epsilon; stderr 1;
end;
```