I am estiamting a pretty standard new Keynesian monetary model with US data, every time when I specify three observables:y pai i, there is a error message:
??? Error using ==> chol
Matrix must be positive definite.
Error in ==> metropolis_hastings_initialization at 52
d = chol(vv);
everything works fine with two observables: y pai.
inf_inertia.mod (1.78 KB)
Hi, can you post the data file ?
this is data for output, pai and i.
output is detrended log, multiplied by 400.
pai is the log difference of CPI, multiplied,
i is the fed fund rate
thanks for your reply.
it won’t allow to upload the data file, do you have an email address, can i send it to your email?
here is the data file, it contain y pai i,
YBook2.xls (24 KB)