# Public debt and fiscal rule
**URL:** https://forum.dynare.org/t/public-debt-and-fiscal-rule/10811
**Category:** Dynare contributions and examples
**Created:** [3 October 2017 14:21 UTC](https://forum.dynare.org/t/public-debt-and-fiscal-rule/10811 "2017-10-03T14:21:12Z")
**Posts on this page:** 4
**Page:** 1
### Author:  [@Manuel\_CG](https://forum.dynare.org/u/Manuel_CG)
#### Post date: [3 October 2017 14:21 UTC](https://forum.dynare.org/t/public-debt-and-fiscal-rule/10811/1 "2017-10-03T14:21:12Z")
Hello everyone
I create a simple RBC model to see how a fiscal rule (a lump-sum tax) works to stabilize the debt-gdp ratio
However, I check all the timing conditions of my variables and I cannot understand why the rank condition is not verified in my model.
The fiscal rule is very similar to the QUEST model one.
[Public\_debt\_baseline.mod](https://forum.dynare.org/uploads/default/original/2X/3/35070753ba294b0f234d09fdd9b70e1df94a4865.mod) (2.7 KB)
I really appreciate any help you can provide
---
### Author:  [@jpfeifer](https://forum.dynare.org/u/jpfeifer)
#### Post date: [3 October 2017 20:11 UTC](https://forum.dynare.org/t/public-debt-and-fiscal-rule/10811/2 "2017-10-03T20:11:44Z")
Check whether there is a sign error somewhere as
```auto
T - T(-1) = -0.01*(Debt_ratio - Debt_target);
```
works
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### Author:  [@Manuel\_CG](https://forum.dynare.org/u/Manuel_CG)
#### Post date: [4 October 2017 21:07 UTC](https://forum.dynare.org/t/public-debt-and-fiscal-rule/10811/3 "2017-10-04T21:07:12Z")
Thanks for your answer professor. Applying a negative sign in the first part of the fiscal rule equation, the rank condition is verified. But, could you explain me why I cannont put a fiscal rule as in QUEST?
Maybe is a question of introduce lags in other variables? I think that I dont control well the timing in some variables in Dynare
In addition, even if the rank condition is verified, I cannot simul a deterministic TFP shock in my model
[Public\_debt\_baseline.mod](https://forum.dynare.org/uploads/default/original/2X/2/2a00f998c06a7d4741da49c902c93c4e6b930c0f.mod) (2.9 KB)
---
### Author:  [@jpfeifer](https://forum.dynare.org/u/jpfeifer)
#### Post date: [5 October 2017 08:03 UTC](https://forum.dynare.org/t/public-debt-and-fiscal-rule/10811/4 "2017-10-05T08:03:22Z")
1. That is something you need to find out. That is why I said there might be a sign error somewhere like using positive values for B to denote assets instead of debt (or the other way round depending on the convention used).
2. Regarding the simulation, try using Dynare 4.5 with
```auto
simul(periods = 100,robust_lin_solve);
rplot A T B;
```