Dear all, I’m a new Dyanre user, and I’m trying to replicate Carolyn Fisher and Michael Springborn business cycle model :“Emissions Targets and the Real Business Cycle: Intensity Targets Versus Caps or Taxes”. I followed all the steps in Dynare, using Fisher and Springborn steady state result. However I have an error message “There are 1 eigenvalue(s) larger than 1 in modulus for 0 forward-looking variable(s) The rank condition ISN’T verified!” Could you please help me? Best regards. I attached the.mod file: fisher_deter.mod (1.5 KB)
It may be the timing problem. Check if there exits lacking of or surplus leading or lagging one period.
Thank you Zhanghuifd for your help. I’ve found the mistake. I had to change a lag in the Euler equation.