Small open economy with working capital requirements for k

Dynare help (legacy posts)
1

I’m currently trying to replicate a SMO model with WC requirements, but simplifying it by assuming that only capital is subject to these constraints. When I run my mod file, I get the following error:

Some element of Newton direction isn’t finite. Jacobian maybe singular or there is a problem with initial values.

I’ve been trying to work around it w/o any success. Can anyone give me a hint on how to fix it?

Thanks!
floating_default_baseline.mod (15.4 KB)

2

i here attach the full model in case it helps
baseline_codes.rar (7.72 KB)

3

It seems you are computing the steady state analytically, but for some reason, it does not solve the model. Have you checked if the equations with residuals are correct?