Steady State Equations resulting in NaN/Inf

This is regarding the analysis of a New Keynesian DSGE model using Dynare. I have adopted an existing model and introduced several new variables alongside first-order conditions and equations. When running the model, Dynare provides the below-mentioned error(s).

Randomize initial guess…

Residuals of the static equations:

Equation number 1 : NaN : 1
Equation number 2 : NaN : 2
Equation number 3 : NaN : 3
Equation number 4 : NaN : 4
Equation number 5 : NaN : 5

According to some of the comments I found, it seems like the issue is pertaining to not finding a steady state.
Would you be kind to suggest what I can do in this regard?
Is there a method (within Dynare) in which I can test whether the model has a steady-state to begin with?
Please find attached herewith my mod file.
fms_mod.mod (20.0 KB)

The param_ERJ_mod.m is missing.

Sorry about that.
Please find it attached below
param_ERJ_mod.m (3.1 KB)

Hi Sanj,

two things that I could find. First, there are some parameters that you did not give any values, Dynare tells you this in a warning:
Warning: Some of the parameters have no value (mu_d, chi1, chi2, T1ss, G1ss, G2ss, agg1, agg2) when using steady. If these parameters are not initialized in a steadystate file or a steady_state_model-block, Dynare may not be able to solve the model...
Second, you only give initial values for a subset of the endogenous variables. This can work, if you are lucky, but most likely yields problems, since Dynare assumes 0 for the ones you did not declare, which easily can lead to Inf or NaN outcomes (e.g. 1/0, log(0),…).

Indeed. For example, you did not set p11, which results in a division by 0.

Thank you very much for this! I will make these changes and give an update

Thank you very much! I will make these changes and give an update

Hi, I tried some changes. Some of the steady-state values get calculated while most don’t. Would you be so kind to let me know of the problem?
I have attached herewith the relevant codes.

FMS.mod (19.3 KB)
FMS_ss.m (10.3 KB)
ModelRun.m (14.9 KB)
param_ERJ.m (3.2 KB)