Ramsey model - issue with "maximum number of iterations has been reached"

Optimal Policy
1

Dear Professor Pfeifer,
I have an issue with the Ramsey model. I want to compute the Ramsey policy solution of the attached model (mod+steady state file). The instrument is the policy rate (R) and I have commented the Taylor rule (line 193 of the mod file). However, I get the error message that the “maximum number of iterations has been reached”. The initial value of R is consistent with the steady state. I do not understand where the problem is.
Your help is greatly appreciated.
Many thanks,
Stefania

effort_ramsey.mod (13.6 KB)
effort_ramsey_steadystate.m (4.7 KB)

2

You need to provide a proper conditional steady state file. Your steady state has

R          = pinf/betta;

but pinf would be a function of the interest rate the planner chooses.