thank you for your quick replay. I corrected the undefined parameters but now I’m facing a new problem. When I run the code I receive following error message:
Using 64-bit preprocessor
Starting Dynare (version 4.6.4).
Calling Dynare with arguments: none
Starting preprocessing of the model file …
Found 13 equation(s).
Computing static model derivatives (order 1).
Computing dynamic model derivatives (order 2).
Processing outputs …
Warning: Some of the parameters have no value (omega1, xi_phi, pi_ss, r_ss, xi_ss, phi_ss, mughat, psi) when using steady. If these parameters are not
initialized in a steadystate file or a steady_state_model-block, Dynare may not be able to solve the model…
STEADY: numerical initial values or parameters incompatible with the following equations
1 4 6 7
Check whether your model is truly linear. Put “resid(1);” before “steady;” to see the problematic equations.
Residuals of the static equations:
Equation number 1 : NaN : Log-linearized Euler equation (18)
Equation number 2 : NaN : Money demand relationship for government currency (19)
Equation number 3 : NaN : Money demand relationship for cryptocurrency (20)
Equation number 4 : NaN : Forward-looking Phillips curve (21)
Equation number 5 : NaN : Log-linerarized FOC derived from the profit maximization problem (22)
Equation number 6 : NaN : Log-linerarized expression for the entrepreneurs productivity that depends on the common producticity in the cryptocurrency sector as well as on the specific productivity of the EN (23)
Equation number 7 : NaN : Log-linerarized Monetary Policy Rule (24)
Equation number 8 : 0 : temporary preference shock to the IS curve (3)
Equation number 9 : 0 : temporary preference shock on money demand to government money (4)
Equation number 10 : 0 : temporary preference shock on money demand to cryptocurrency (5)
Equation number 11 : 0 : temporary prefernece shock on the productivity of the other entrepreneuer via common component (6)
Equation number 12 : 0 : temporary preference shock on the specific programming skills of the entrepreneur (7)
Equation number 13 : 0 : temporary technology shock (productivity shock) (14)
Error using print_info (line 32)
The steady state has NaNs or Inf.
Error in steady (line 102)
Error in ALR_rep_4.driver (line 375)
Error in dynare (line 293)
evalin(‘base’,[fname ‘.driver’]) ;
I know that the problem are the following parameter: omega1, xi_phi, pi_ss, r_ss, xi_ss, phi_ss, mughat, psi. Since these parameter are part of the model equations, I added them at the list of delcered parameters but the problem which I’m facing now is that I don’t have estimated values for them.
ALR_rep_4.mod (11.5 KB)
Please can you tell me how I can solve such a problem?
Thank you and best regards,