Sorry for asking this question, it most probably has been addressed many times in forum before. I have estimated my model and simulated it at the calibrated posterior mean. Dynare produces the theoretical moments, which I want to compare with the data to assess the model’s fit. I have used the command:
stoch_simul(order=1, irf=20, irf_shocks = (eps_r, eps_zh, eps_p, eps_mh), graph_format = pdf, conditional_variance_decomposition = [4 8]) variable1 variable2 …
The only problem is that I have quadratically detrended the data. So I’m not sure how to compare it to the actual data. I know that we usually want to compare HP filtered theoretical moments with the HP filtered data. However, how would I do this in my case? I should also mention my model in entered in Dynare nonlinearly and observables are mean zero.
Many thanks for your help,