dear all,
I am using dynare to estimate an economic model with fiscal policy but i met a problem as follow:
Error in computing likelihood for initial parameter values
??? Error using ==> print_info at 45
Blanchard Kahn conditions are not satisfied: indeterminacy due to rank failure
Error in ==> initial_estimation_checks at 101
print_info(info, options_.noprint)
Error in ==> dynare_estimation_1 at 122
initial_estimation_checks(xparam1,gend,data,data_index,number_of_observations,no_more_missing_observations);
Error in ==> dynare_estimation at 62
dynare_estimation_1(var_list,varargin{:});
Error in ==> lwmatlap2 at 190
dynare_estimation(var_list_);
Error in ==> dynare at 120
evalin(‘base’,fname) ;
I don’t know what it means and how can i fix it?
lwmatlap2.mod (1.61 KB)