# Singularity problem and Colinear equations

Dear professor jpfeifer,

I am working on a DSGE mod file, but it runs into some problems that I can’t solve. model_diagnostics indicates that the Jacobian of the static model is singula and there is 8 colinear relationships between the variables and the equations. Many of the colinear equations are exogenous processes and AR(1) processes, I can’t understand why these processes can be colinear ralationships.

Colinear equations
12
Relation 2
Colinear equations
8
Relation 3
Colinear equations
33 34 39 48 54
Relation 4
Colinear equations
33 34 39 52 54
Relation 5
Colinear equations
33 34 39 48 52 54
Relation 6
Colinear equations
33 34 39 48 54
Relation 7
Colinear equations
33 34 39 48 52 54
Relation 8
Colinear equations
34 39 48 52 54

equation 8 log(iff)=(1-rhof)log(iff_ss)+rhoflog(iff(-1))+e_f;
equation 33 log(Yw)=(1-rhoW)log(Yw_ss)+rhoWlog(Yw(-1))+e_W;
equation 34 log(pi_W)=(1-rhopiw)log(piW_ss)+rhopiwlog(pi_W(-1))+e_piw;

MODEL_DIAGNOSTICS: The presence of a singularity problem typically indicates that there is one
MODEL_DIAGNOSTICS: redundant equation entered in the model block, while another non-redundant equation
MODEL_DIAGNOSTICS: is missing. The problem often derives from Walras Law.

1. Is the DSGE model I am working on has unit roots?
2. why exogenous processes and AR(1) processes can be colinear ralationships?
3. Is the problem steming from one redundant equation entered in the model block, while another non-redundant equation is missing?

any advices will be great for me,
Thank you very much, professor.

Kcapital20200629.mod (20.8 KB) capitaldata20200629.xlsx (13 KB)

1. As the `check`-command shows, there is no unit root.
2. The problem may be your use of the `steady_state`-operator. Please have a look at

Thank you very much, professor，jpfeifer.

Yes, you are right. After simply change some `steady_state` -operators, for example, change # id_ss=1/beta; the amount of colinear equations are decreasing. I will working on by following your advices, thank you for your always useful helps.

Thank you!