Hello dear user,

I am trying to run a NK-DSGE model. Unfortunately, the model diagnostic tells me that “here is one redundant equation entered in the model block, while another non-redundant equation is missing. The problem often derives from Walras Law”. And the residual of one of my static equation is zero.

When i take a look on my model, i do not see any redundant equation or any one that should be added. So i do not know if there is a way dynare can indicate me where is the colinearity.

I attached my .mod file.

Thanks a lot for your help.

EEE.mod (6.8 KB)

Check your timing. For example

```
k/l=(alpha*w)/((1-alpha)*q);
```

should probably be

```
k(-1)/l=(alpha*w)/((1-alpha)*q);
```

Thanks for your quick response.

Sorry not to have updated my .mod file but I have checked all this possible timing problem related to capital but it seems not to be the problem.

When I changed the timing of that one equation, the error changed from singularity to indeterminacy. So there is definitely something wrong with your timing. You may have to start with a simpler model.

Thanks a lot, I will start there.

I have started with a simple that i have been able to run. But once I add my structure, it fails to run. I still think my structure is consistent.

Also, it seems the ability of my model to compute the steady depends on whether or not I solve capital before real wage in steady state. Do you have idea of what should be solved first?

Thanks.

I am 99% sure that it is not a matter of timing.

Now what i meant earlier was that i can determine real wage with through marginal cost (in this case it will not depend on l) and then determine capital. Or I can first derive capital and after determine real wage (in this case it will depend on l).

Maybe i should attach my equilibrium conditions.

Do the two ways of determining the real wage result in the same value?

Unfortunately it does not. Once is around 12 and the other is less than 1. But I guess the the first one is more plausible.

Then you should try to figure out where the difference comes from. Maybe that will show you where the problem is.