Hi all,
I just started working with Dynare and I have to simulate an RBC model with habit formation. Unfortunately, the output is always the same regardless of the habit formation parameter (lambda in my case). I cannot see what I am doing wrong and I am happy for any suggestion. Thanks a lot.
rbchf.mod (2.61 KB)
What do you mean with the output is always the same? If I run your code, the policy functions for lambda=0.9 are
POLICY AND TRANSITION FUNCTIONS
y c k i l r w z g
Constant 1.485295 0.884463 15.233353 0.380834 0.400991 1.010101 2.370598 0 0.219998
k(-1) 0.009780 0.003393 0.981387 0.006387 -0.010681 -0.002073 0.078755 0 0
z(-1) 1.728407 0.062880 1.665527 1.665527 0.133881 0.040846 1.967134 0.950000 0
g(-1) 0.283437 -0.021863 -0.594700 -0.594700 0.119564 0.006698 -0.254463 0 0.900000
c(-1) 0.283437 0.878137 -0.594700 -0.594700 0.119564 0.006698 -0.254463 0 0
e_z 1.819376 0.066190 1.753186 1.753186 0.140927 0.042996 2.070668 1.000000 0
e_g 0.069284 -0.005344 -0.145370 -0.145370 0.029226 0.001637 -0.062201 0 0.219998
For lambda =0 they are:
POLICY AND TRANSITION FUNCTIONS
y c k i l r w z g
Constant 1.419456 0.835509 14.557985 0.363950 0.383218 1.010101 2.370588 0 0.219998
k(-1) 0.017994 0.036101 0.956892 -0.018108 -0.007217 -0.001966 0.074693 0 0
z(-1) 1.809749 0.377428 1.432320 1.432320 0.194579 0.044753 1.818738 0.950000 0
g(-1) 0.236419 -0.213374 -0.450206 -0.450206 0.099730 0.005846 -0.222096 0 0.900000
e_z 1.904998 0.397293 1.507706 1.507706 0.204820 0.047108 1.914461 1.000000 0
e_g 0.057791 -0.052158 -0.110049 -0.110049 0.024378 0.001429 -0.054290 0 0.219998
They clearly differ so the habit persistence makes a difference.
You are right. Everything is fine. It seems to me that I simply did not specify the current directory correctly (beginner’s mistake…). But thanks for your reply.