I am new to Dynare and I have a model with a permanent shock that is supposed to stay forever. So after finding the steady state I wrote this:
So “switchh” should go from 0 to 1 and then stay there forever. However when I simulate this for 50 periods, in period 51 it goes back to 0 (and also all other variables go back to their initial steady state values. Can this be ignored (since it is after the end of the specified period) or does it affect the whole simulation?
Best and thanks for any help!