# Questions about financial accelerator

**URL:** <https://forum.dynare.org/t/questions-about-financial-accelerator/12572>\
**Category:** General DSGE Modeling\
**Created:** [11 October 2018 05:44 UTC](https://forum.dynare.org/t/questions-about-financial-accelerator/12572 "2018-10-11T05:44:10Z")\
**Posts on this page:** 3\
**Page:** 1

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**Author:** ![wu\_Justin](https://forum.dynare.org/letter_avatar_proxy/v4/letter/w/54ee81/32.png) [@wu\_Justin](https://forum.dynare.org/u/wu_Justin)\
**Post date:** [11 October 2018 05:44 UTC](https://forum.dynare.org/t/questions-about-financial-accelerator/12572/1 "2018-10-11T05:44:10Z")

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Hello , everyone:  
I am working on a paper about cooperation about macroprudential and monetary policy. Because there are something wrong in the model, so I tested financia accelerator first , but I found the plots is weired, I thought tight monetary induce production capital is decling , not rising. I wonder if there is something wrong in my tested code. Here is my tested .mod code, I hope someone can help me, thank you! [M3.mod](https://forum.dynare.org/uploads/default/original/2X/f/f9e249f98e82f0ee61377a2ca2075b2e90f50aa6.mod) (5.0 KB)

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**Author:** ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)\
**Post date:** [11 October 2018 19:01 UTC](https://forum.dynare.org/t/questions-about-financial-accelerator/12572/2 "2018-10-11T19:01:55Z")

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That is hard to tell. Does the model work as expected without the financial accelerator? Also, my reply at

> [@Wired IRFs about financial accelerator shut off](https://forum.dynare.org/t/wired-irfs-about-financial-accelerator-shut-off/12574/2):
>
> This is one of the questions that is impossible to answer. Nobody except for you knows how the model is supposed to work. So you need to find out what is going on in it. What causes investment to drop? You should try to investigate the factors that drive investment like interest rates, risk premia, and capital prices. Maybe something strange shows up.

applies here, just with an opposite sign.

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**Author:** ![wu\_Justin](https://forum.dynare.org/letter_avatar_proxy/v4/letter/w/54ee81/32.png) [@wu\_Justin](https://forum.dynare.org/u/wu_Justin)\
**Post date:** [12 October 2018 03:26 UTC](https://forum.dynare.org/t/questions-about-financial-accelerator/12572/3 "2018-10-12T03:26:40Z")

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thank you for your reply ,professor.  
I have used the financia accelerator code from the fabio verona code in the paper of Christiano, Motto and Rostagno (2010) risk shocks. But I found when I give a bank benchmark interest rate positive shock to financial accelerator, the production capital is rising, not decling, so I wonder If I was wrong when I used financia accelerator part, not considering the other part.  
 ![1](https://forum.dynare.org/uploads/default/original/2X/6/61ca4f4b13faed16f570b70c82a81a1122df3d3b.jpeg)