Simple RBC model setup error for bayesian estimation

[jpfeifer]

Sorry, I don’t have time to check users’ linearizations. But particularly the second equation looks incorrect. In additive equations, there will be pre-factors as the steady states will not cancel.

Also, why are you doing this? See

Why do we log linearize a model by hand?

Hello, Some of you may find that it is such a silly question, but I cannot understand why sometimes people log linearize a model before putting it into Dynare. What is the purpose behind that given that the software does perfectly the job? Thanks.