Dear Professor,
I am handing new Keynesian model with Rotemberg price setting and financial accelerator. I managed to let dynare find steady state based on my initial setting, but it shows fail to satisfy BK condition(need 11 but only have 10). I have tried to adjust the response of taylor rule and some other parameters’ value but it still unsolved. Can you have a look at file and advice what can I do to solve the problem? By the way, I want to ask what do you recommend to find the steady state, find the steady state by hand and write it into dynare or use initival?
Thank you so much for your help!
D
example.m (1.7 KB)
dissertation.mod (4.3 KB)
The timing in
n(1)=(1+r)*b-(1+i)*D; %net worth of bank
for n looks incorrect.
Dear Professor,
Yes, I have adjusted the notation and the parameter of price setting and finally works!
Thank you so much for your help!
D