Hello, I am trying to run the attatched dynare mod file and following matlab files for steady state. To get the steady state value, I used ‘fsolve’(‘solve_calibration.m’) while running ‘_steadystate.m’ file. I used the example code by JohannesPfeifer : “DSGE_mod/Gali_2010/Gali_2010_calib_target_steadystate.m at master · JohannesPfeifer/DSGE_mod · GitHub”. The ‘fsolve’ was done successfully(please refer to ‘_error.txt’) and I got my ‘deep parameters’ updated with no weird values. However, I got ‘The steadystate file did not compute the steady state’ message with the following result.

Residuals of the static equations:

Equation number 1 : NaN : 1. FOC consumption

Equation number 2 : NaN : 2. Euler equation

Equation number 3 : -0.03451 : 3. FOC capital utilization

Equation number 4 : -Inf : 4. FOC capital

Equation number 5 : NaN : 5. FOC investment

Equation number 6 : 0 : 6. Firm price setting 1

Equation number 7 : 0 : 7. Firm price setting 2

Equation number 8 : 0 : 8. Firm price setting 3

Equation number 9 : 0 : 9. Marginal cost

Equation number 10 : -Inf : 10. law of motion prices

Equation number 11 : NaN : 11. Optimal capital labor ratio

Equation number 12 : 0 : 12. law of motion employment

Equation number 13 : -1 : 13. unemployment measure

Equation number 14 : NaN : 14. Job finding rate

Equation number 15 : 0 : 15. Value of firm

Equation number 16 : 0 : 16. recursive representation of nup

Equation number 17 : 0 : 17. recursive representation of wp

Equation number 18 : -Inf : 18. optimal condition for wholesaler

Equation number 19 : 0 : 19. Value of work

Equation number 20 : 0 : 20. Present value of worker payoff after separation

Equation number 21 : -0.46127 : 21. Unemployment value

Equation number 22 : NaN : 22. Vacancy filling rate

Equation number 23 : 0 : 23. Matching function

Equation number 24 : NaN : 24. Job market tightness

Equation number 25 : 0.47575 : 25. AOB equilibrium equation

Equation number 26 : 0 : 26. Monetary Policy

Equation number 27 : 0 : 27. Tax Rule

Equation number 28 : NaN : 28. Government budget constraint

Equation number 29 : NaN : 29. Resource constraint

Equation number 30 : NaN : 30. Aggregate production

Equation number 31 : -Inf : 31. LOM Price dispersion term

Equation number 32 : NaN : 32. Law of motion for capital

Equation number 33 : 0 : 33. Profits of the intermediate firm

Equation number 34 : 0 : 34. Preference Shock

Equation number 35 : 0 : 35. UB Shock

Equation number 36 : 0 : 36. Investment specific technology

Equation number 37 : 0 : 37. Neutral technology

Equation number 38 : 0 : 38. Defininition composite technology

I checked the equations for any typos or other mistakes but I could not find one. I would be really appreciated if anyone could help me handle the problem.

To add a short background, the model is a medium scale NK model(similar to NK baseline model but for labor market frictions and some policy structures). The labor market frictions come from Christiano et.al.(2016, Econometrica) and some notations(e.g. ump) from Ravenna and Walsh(2011). I did not make use of Omega as in Christiano et.al.(2016, Econometrica) for this prototype version.

Thank you so much.

Regards,

Yoonhyok Choi

aob_policy_regime.mod (10.5 KB)

aob_policy_regime_steadystate.m (6.4 KB)

solve_calibration.m (730 Bytes)

aob_policy_regime_error.txt (3.2 KB)