Dear Professor Pfeifer,
(1) I set up a deterministic DSGE model and want to see the trajectory of endogenous variables (e.g. output) after adding of a new tax. I add this new tax variable into the model as a permanent shock, but the result says “Failed to solve perfect foresight model”. How should I improve this ?
(2) If I add this permanent deterministic shock into the stochastic model by using varexo_det and also mean to see the trajectory of endogenous variables, do I get same results of trajectory plot as in (1) or different ?
Thank you for your time.
Best regards