Some of the steady-state values are negative numbers

model526.mod (4.0 KB)
Hello professor, I wrote a model, but the run out of the steady-state value in the tax is negative, and the impulse response graph does not seem to match the reality, what is the reason for this?Can I solve this problem by adjusting the value of parameters?Looking forward to your reply ,thank you!

(1) IRF may be caused by timing erro.
(2) There is something wrong with steady state value, the value of variable h should be caculated, but you directly set h=1/3, so steady-state value in the tax is negative.

Thank you for your reply.

  1. I don’t quite understand the time error, can you say more details?
    2.Regarding the setting of h, some books set it to one-third, and I can’t do that?
    Looking forward to your guidance,thank you!
  1. It means that you should pay attention to the variable timing, t or t-1period.
  2. If you set h to one-third, then you should calibrate some parameters to make sure the value of h correct.
    Or you should caculate h.

thank you I will check my model.Does the period of k need to be k(-1)?

Hello, I would like to ask how I should set it up if I want to see the impulse response graph of the impact of negative shocks on the economy. For example, a decline in total factor productivity should lead to a decline in output, but in my chart output is rising.I’m a beginner and maybe my questions are a bit silly . looking forward to your guidance,thank you
model526.mod (4.0 KB)