Could somebody suggest books/papers of how to solve linear RE DSGE models? I would like to obtain a DSGE’s state-space representation. Despite my google attempts, I could never find a didactic guide (I never took courses on it, I’m self taught). The dr.pdf paper in the dynare folders would not do as it has a truly complicated notation, uses the Schur decomposition (unnecessary in my specific case where DSGE`s matrices are invertible) and applies to nonlinear models (my problem is linear, should be easier).
I’m afraid that my own tentative solution is wrong as its transition matrix is slightly different from the oo_.dr.ghx output from Dynare.
Would anyone know a good, didactic how-to guide to solve linear RE DSGEs?
Thanks for your attention.
I have sent you some teaching materials. A general reference would be Dejong/Dave, Structural Macroeconometrics, Second Edition http://press.princeton.edu/titles/9622.html
Unfortunately, the book has a lot of typos and they don’t bother with an errata list for the second edition. We provide an unofficial one at https://sites.google.com/site/pfeiferecon/Errata.pdf?attredirects=0
That’s is great! Thanks a lot for your help!
Would you send me the material too?
I am studying this topic (how to solve linear RE DSGE models).
I invited you to the PM