Steady State Not Computing

Steady state
1

I would really appreciate it if anybody could help me out. The code is provided below.
dsge.mod (3.5 KB)

Residuals of the static equations:
Equation number 1: C_H : -0.000100
Equation number 2: C_L : -0.100000
Equation number 3: N_H : -0.050000
Equation number 4: N_L : 0.000000
Equation number 5: W_H : 0.223593
Equation number 6: W_L : 0.172694
Equation number 7: P : 0.000000
Equation number 8: Y : 0.455571
Equation number 9: r : 0.003000
Equation number 10: MC : 0.030000
Equation number 11: pi : 0.000000
Equation number 12: P_star : 0.580000
Equation number 13: A : 0.100000

2

Your file contains many mistakes.

  1. See
  1. Your Taylor rule implies that r=0 in steady state, which is inconsistent with \beta\neq1
  2. The post

also applies in your model.

1 Like
3

Thank you so much for the reply. I am completely new to DSGE modeling and it’s quite confusing to solve the errors. Are the three points you mentioned enough to solve the model? If not, what other adjustments should I make?

4

That’s hard to tell. It’s an iterative process. You need to check your model for mistakes and keep working on it.

5

Okay I’ll try to do so. Thank you