Problem in observation equations

Dear people, I have followed the “Guide to specifying…” in specifying observation equation.

I have a model with unit-root labour augmenting growth (mu) and investment specific technical growth (gz). Let us say, output in the model growth with g (which is some combination of mu and gz).
Now my observation equation linking logged difference of GDP (without demeaning) with model counterparts looks like:

y_obs = y_hat - y_hat(-1) + g_hat + g_ss + measurement_error ;

But using this gives me non-zero residuals. I think I am doing this right. Please suggest where lies the problem?

The way you wrote it down, the data has not been demeaned and y_obs will have steady state g_ss

Thnx, but I dont understand.

Attached is the mode-file and datat file for your kind perusal.

BE.mod (9.0 KB) final_data.xlsx (27.6 KB)

I am saying you are missing:

dc=mu_ss + (alpha1/(1-alpha1))*gz_ss ;
di=mu_ss + (alpha1/(1-alpha1))*gz_ss ;
dy=mu_ss + (alpha1/(1-alpha1))*gz_ss ;

Thank you so much Professor!!!

May I ask one more question,!! According to the variance decom, in my model, monetary policy shock (white-noise) has very less impact on the dynamics of nominal interest rate. But it has a large impact on inflation and even on other real variables. What is wrong!! Any suggestion?

Are you sure there is anything wrong and there is no good economic reason for this?