Small open economy

macroeco · March 5, 2015, 8:30pm

Hi,

I’m just a new user of dynare but I have a problem with the computation of the steady state I think. Actually, when I want to run my program, it crashes! The message that appears is as follows:

*Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Local state space iteration (second order).
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
[mex] Quasi Monte-Carlo sequence (Sobol).
[mex] Markov Switching SBVAR.

Starting Dynare (version 4.4.3).
Starting preprocessing of the model file …
Substitution of endo leads >= 2: added 1 auxiliary variables and equations.
ERROR: There are 14 equations but 15 endogenous variables!

error: DYNARE: preprocessing failed
error: called from:
error: c:\dynare\4.4.3\matlab\dynare.m at line 174, column 5
*
I have 14 endogenous variables, I don’t understand why it considers there are 15.
Could you help me, please?

Thanks in advance!
example4.mod (1.33 KB)

jpfeifer · March 6, 2015, 7:27am

We will look into this issue and keep you posted.

jpfeifer · March 16, 2015, 4:11pm

The problem is that you define 14 endogenous variables, but you have only 13 equations in your model block. The message is thus correct. As the preprocessor says,

There is one additional equation added due to your having k(2) in the model (Note that this suggests that you most probably have a timing error; from looking at it capital should be predetermined; you could use the predetermined_variables command). After adding one auxiliary variable with one defining equation, you are left with 15 variables, but still only 14 equations.

macroeco · March 20, 2015, 6:18pm

Thanks a lot !

So I have been trying to fix problems I’ve got with Dynare and I think that the previous problem with the number of endogenous variables is ok.
However, a new one appears now : when I run the program, this message appears :

*Starting Dynare (version 4.4.3).
Starting preprocessing of the model file …
Substitution of endo leads >= 2: added 1 auxiliary variables and equations.
Found 16 equation(s).
Evaluating expressions…done
Computing static model derivatives:

order 1
Computing dynamic model derivatives:
order 1
order 2
Processing outputs …done
Preprocessing completed.
Starting MATLAB/Octave computing.

parse error near line 225 of file c:\dynare\work\essai20mars.m

syntax error

end;
^

error: called from:
error: c:\dynare\4.4.3\matlab\dynare.m at line 180, column 1*

I checked in the .m file, line 225, and indeed there is a “end” that appears. I had a look at some examples of files on the website and even if I know that this “end” shouldn’t be there, I’m still try to understand why it appears and what I have done that is wrong. Could you enlighten me once more, please?

Thanks in advance!
Dynare code - SOE EDEIR model with government.txt (3.09 KB)

jpfeifer · March 21, 2015, 3:19pm

In your mod-file there is a lonely end; at the end of the parameter definitions before the model-block. Delete it.

macroeco · March 27, 2015, 4:34pm

Thanks ! But now I’ve got a problem with two residuals. I checked the parameters and I don’t understand where the problem could be from

*Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : 0
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0.00025434
Equation number 6 : 0
Equation number 7 : -0.038955
Equation number 8 : 0
Equation number 9 : 0
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 0
Equation number 14 : 0
Equation number 15 : 0

error: The steadystate file did not compute the steady state
error: called from:
error: c:\dynare\4.4.3\matlab\print_info.m at line 72, column 9
*

Very sorry for bothering you…

jpfeifer · March 27, 2015, 5:34pm

That means either those two equations are wrong or your steady state computation in the steady_state file is wrong. Check them.

macroeco · April 4, 2015, 11:09am

If I’m not mistaken, we are supposed to have as many eigenvalues larger than one as we have forward looking variables. I have 5 forward looking variables (both of them are +1), I have 5 eigenvalues greater than one but this message appears :

*Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Local state space iteration (second order).
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
[mex] Quasi Monte-Carlo sequence (Sobol).
[mex] Markov Switching SBVAR.

Starting Dynare (version 4.4.3).
Starting preprocessing of the model file …
Substitution of endo leads >= 2: added 1 auxiliary variables and equations.
Found 16 equation(s).
Evaluating expressions…done
Computing static model derivatives:

order 1
Computing dynamic model derivatives:
order 1
order 2
Processing outputs …done
Preprocessing completed.
Starting MATLAB/Octave computing.

STEADY-STATE RESULTS:

c 0.326759
r_f 0.01375
w 1.71365
v 0.0578358
l 0.200324
k 3.19604
i 0.079901
y 0.528131
a 1
b 0.85125
d 0.301034
g 0.105626
tb 0.0158439
nd 0
h 1.15228

Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : 0
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : 0
Equation number 8 : 0
Equation number 9 : 0
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 0
Equation number 14 : 0
Equation number 15 : 0

EIGENVALUES:
Modulus Real Imaginary

  4.613e-017      -4.613e-017                0
  1.313e-015       1.313e-015                0
       0.904            0.904                0
      0.9163           0.9163                0
      0.9538           0.9538                0
      0.9972           0.9972                0
       1.014            1.014                0
        1.02             1.02                0
  4.695e+017       4.695e+017                0
  2.101e+019       2.101e+019                0
         Inf             -Inf                0

**There are 5 eigenvalue(s) larger than 1 in modulus
for 5 forward-looking variable(s)

The rank condition ISN’T verified!
error: Blanchard Kahn conditions are not satisfied: indeterminacy due to rank failure
*error: called from:
error: c:\dynare\4.4.3\matlab\print_info.m at line 48, column 9
error: c:\dynare\4.4.3\matlab\stoch_simul.m at line 98, column 5
error: c:\dynare\work\incomplete_markets_new.m at line 237, column 6
error: c:\dynare\4.4.3\matlab\dynare.m at line 180, column 1

Where could the problem come from ?

PS : Happy Easter to all of you !

jpfeifer · April 4, 2015, 11:31am

See the bottom of [On forward looking variables)