Sequence of Shocks perfect foresight

Perfect foresight simulations
1

Hi everybody,
I am simulating the perfect foresight response of the economy to an anticipated carbon tax in Dynare.

The issue is that if I set the carbon tax value in the endval block, the tax assumes the ‘endval;’ value from period 2 onwards. How can I embed a non-constant tax schedule that increases over time in the exo_simul matrix?

I was thinking of specifying a shock vector in the .mod file and using it in the shocks block, though since I have to give a precise value to each element of the shock vector, it could be infeasible to do in the .mod file, as I am dealing with 1000-time periods tax schedule.

I would really appreciate any suggestions.
Thank you!

2

You can pass a vector to the shocks block. An example from the Dynare manual is

xx = [1.2; 1.3; 1];
shocks;
var e;
periods 1:3;
values (xx);
end;
3

yes I have thought about it but how can I handle it easily if that xx vector is a 1 x 1000 vector? I have to necessairly specify all the values?

Thank you professor Pfeifer

4

You somehow have to define that vector. But you can use Matlab syntax for that. Or where does the path for the tax come from?

5

Solved, thank you professor