I am trying to combine a Heterogeneous firm model and a Energy part.
However I met BK condition problem, here’s my bafflement:
- If I use the regular convention of
K=(1-DELTA)*K(-1)+I, and the capital market divided into 2 parts,
Kp, how would I express
K_t = K_s,t + K_p,tin model.
is this a correct method?
- The model met BK condition when I used such convention by having 2 forwl_var by 3 explosive root. But, If I use
it works well. What is the difference between
- How is the difference of ‘Forward-Looking Variable’ and others in the Dynare process. If I use (b) or (c) and get a answer, what is that? How can it be explained?
- Or the problem is not in the using of ‘K’, but I cannot see where could the mistakes be. Here’s my ‘codezip’, and I been struggled on working on the BK condition problem, the reference of ‘Energy’ is in the pack.
Thanks a lot in advance!
codezip.zip (879.4 KB)