The steadystate file did not compute the steady state (Even it is computed)

Steady state
1

Dear Professors,

I hope this message finds you well. I am writing to seek assistance with a particular issue I have encountered while working on a code. Upon executing the code provided in the attached document, I encountered the below error:

However, upon further examination, I have observed that the steady-state component of the code is functioning as expected. I am reaching out to kindly request your guidance and expertise in resolving this error. Your assistance in this matter would be greatly appreciated.

For your reference, please note that my code is intended to be executed by running the “run_me.m” MATLAB script.

Thank you in advance for your time and support.

Sincerely,

fsolve stopped because the vector of function values is near zero, as measured by the value
of the function tolerance. However, the last step was ineffective.
Model-1.rar (28.2 KB)

<stopping criteria details>
**Error using print_info**
**The steadystate file did not compute the steady state**
**Error in check (line 48)**
**    print_info(info, 0, options);**
**Error in agenor.driver (line 452)**
**oo_.dr.eigval = check(M_,options_,oo_);**
**Error in dynare (line 281)**
**    evalin('base',[fname '.driver']);**
**Error in Run_me (line 13)**
**dynare agenor nolog**
2

If you move the resid before check you will see that there are many residuals. There must be something wrong with the code.

3

In this case, can we say steady-state calculation is working and steady state values are calculated? And is the problem with mod-file and particularly in the formulation of the equations contained there ?

Interestingly, when I apply log-linearization to the same model and proceed with the identical steady state calculation, all the residuals yield a value of 0, and the model functions as expected. I have enclosed the log-linearized version for your reference.

Thank you once again for your invaluable support.
Model-2.rar (5.9 KB)

4
  1. No, all you know is that there is an inconsistency between the steady state equations and the entered dynamic model equations.
  2. For linearized models, the steady state of the deviations from steady state are zero. But you typically need the level steady states as parameters. That is dangerous because there is no correctness check attached to these values.