Strange impulse response result of productivity shock


#1

Dear all:

I have a question about the differences on impulse response pictures of linear dynare model and non-linear. When I run a basic NK model (I use a log-linear model in dynare)and add a positive productivity to see the result. Output changes from negative to positive and then goes back to steady state. And, my question is, how can output be negative at period 0? It is a positive technology shock! Even though the impulse response picture of output is hump shape, I still don’t know how to interpret this result.
Please help!
Many Thanks in advance!


#2

Usually that means there is a mistake in your model. See


for basic nonlinear and linear NK models that do not show this problem