Residuals of static equations cannot get to be zero

Hi,

I am doing simple closed economy model with coal firms. I got an error message showing “The steadystate file did not compute the steady state”, and I looked at the Residuals of the static equations which is showing like:

Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : 0
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : -0.00012672
Equation number 8 : 0
Equation number 9 : 0
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 0
Equation number 14 : 0
Equation number 15 : 0
Equation number 16 : 0
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 21.5985
Equation number 20 : 0
Equation number 21 : 0
Equation number 22 : 0
Equation number 23 : 0
Equation number 24 : 0
Equation number 25 : 0
Equation number 26 : 0
Equation number 27 : 0

I am really confused about this question. Does the error message appear because I got too big residuals in some equations and I got wrong steady states? If I log-linearize, will the problem be gone?

Many thanks in advance!
yan

coal_model.txt (6.0 KB)

You have one equation with a really large residual. You should focus on this one.

Hello, I suggest you to look at the initial values for w_c and labor_c. I am not sure if that helps but maybe it is a good start.

Hi, Pof. Pfeifer

Thank you for your relpy. I tried to revise the initial values for this equation, but the residual is still not 0, but a small value, 1e-5. Then I log-linearized all the functions, the problem is solved. Thanks again

yan

Hi, fernando,

Thank you for your suggestion. I tried to revise the initial values for this two variables, but the residual is still not 0. Maybe the lambda and w should be endogeous. Anyway, I log-linearized all the functions, the problem has been solved. Thank you again for your reply.

yan

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