Rank Condition Failure(“The rank condition isn’t verified”) in Dynare DSGE Model

Steady state
1

Dear Dr. Pfeifer,

I hope this message finds you well.
I am currently working on a DSGE model in Dynare and have encountered a persistent issue related to the Blanchard & Kahn conditions. When I run the model, Dynare reports the following message:

There are 4 eigenvalue(s) larger than 1 in modulus
for 4 forward-looking variable(s)

The rank condition ISN’T verified!

MODEL_DIAGNOSTICS: The following endogenous variables aren’t present at the current period in the model: J
错误使用 print_info (line 32)
Blanchard & Kahn conditions are not satisfied: indeterminacy due to rank failure.

出错 stoch_simul (line 120)
print_info(info, options_.noprint, options_);

出错 steady.driver (line 773)
[info, oo_, options_, M_] = stoch_simul(M_, options_, oo_, var_list_);

出错 dynare (line 281)
evalin(‘base’,[fname ‘.driver’]);

I have carefully checked the model equations, and the number of equations matches the number of endogenous variables. However, the error persists even though the number of unstable eigenvalues equals the number of forward-looking variables. This is my code. I look forward to your reply.

steadyme.mod (4.3 KB)

2

As model_diagnostics clearly states, J does not appear with the correct timing. You only have J(+1) in the model, implying that the contemporaneous value of J cannot be determined.

3

Thank you so much for your help, it’s working now.