Dear Professor Pfeifer
Thanks for your prompt response. I appreciate your help and guidance. In fact, I am grateful to have the opportunity to learn Dynare-Octave as a fresh tool for running stochastic simulation for DSGE models.
I followed you advice to modify my Dynare model code (sidrauski.mod). Also, I would like to attach the Dynare numerical project spec and my hand-written steady-state solutions (see also the JPEG attachments). I tried running one of your sample codes successfully in Dynare-Octave with smooth and fabulous output results and nice impulse-response charts. There might still be some egregious error(s) in my new Sidrauski code snippets. However, I continued to experience the same error message: Impossible to find the steady state…
Below I attach again the complete output and error message. While we can see some improvement in Equations #1, #2, #4, #5, and #6, the other residual errors seem too large for Dynare to find the steady state…
It is my first time to use Dynare-Octave, so I would really appreciate your meticulous help and guidance on this technical issue. Would you be kind enough to help modify my Sidrauski model code snippets to make this stochastic simulation work in practice? Then I would use the exponential-logarithmic operator to transform every random variable in terms of percent deviations from the steady state. Many thanks for your kind advice in advance!!
NB. As a new user, I can only upload one picture at a time. For this reason, I need to upload my hand-written notes with steady-state solutions in subsequent replies.
sidrauski.mod (1.0 KB)
Residuals of the static equations:
Equation number 1 : -0.0013296
Equation number 2 : -5.6458e-005
Equation number 3 : 0.060371
Equation number 4 : 1.3483e-005
Equation number 5 : -0.0013431
Equation number 6 : 9.4694e-007
Equation number 7 : 0.09359
Equation number 8 : -0.86382
error: Impossible to find the steady state. Either the model doesn’t have a steady state, there are an infinity of steady states, or the guess values are
too far from the solution