Unable to acheive steady state please help

Dynare help (legacy posts)
1

please the following error occured after running my model;

Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Local state space iteration (second order).
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
[mex] Quasi Monte-Carlo sequence (Sobol).
[mex] Markov Switching SBVAR.

Starting Dynare (version 4.3.3).
Starting preprocessing of the model file …
Substitution of exo lags: added 4 auxiliary variables and equations.
Found 55 equation(s).
Evaluating expressions…done
Computing static model derivatives:

  • order 1
    Computing dynamic model derivatives:
  • order 1
  • order 2
    Processing outputs …done
    Preprocessing completed.
    Starting MATLAB/Octave computing.

Warning: Divide by zero.

In kk1_static at 175
In dynare_solve at 44
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk1 at 457
In dynare at 120
Warning: Divide by zero.
In kk1_static at 354
In dynare_solve at 44
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk1 at 457
In dynare at 120
Warning: Divide by zero.
In kk1_static at 356
In dynare_solve at 44
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk1 at 457
In dynare at 120
STEADY: numerical initial values or parameters incompatible with the following equations
27 40 46

Please check for example
i) if all parameters occurring in these equations are defined
ii) that no division by an endogenous variable initialized to 0 occurs
Warning: Divide by zero.

In kk1_static at 175
In evaluate_static_model at 63
In evaluate_steady_state at 94
In steady_ at 54
In steady at 81
In kk1 at 457
In dynare at 120
Warning: Divide by zero.
In kk1_static at 175
In resid at 75
In steady at 90
In kk1 at 457
In dynare at 120

Residuals of the static equations:

Equation number 1 : -2.3e-005
Equation number 2 : 2.5e-006
Equation number 3 : 87.1111
Equation number 4 : -584.595
Equation number 5 : 398.0284
Equation number 6 : -77.71
Equation number 7 : -74.93
Equation number 8 : -75.625
Equation number 9 : -78.405
Equation number 10 : 0.8
Equation number 11 : 800.2
Equation number 12 : 40.3
Equation number 13 : 10.4
Equation number 14 : 12.1
Equation number 15 : 11.6045
Equation number 16 : 522.9327
Equation number 17 : 29.4386
Equation number 18 : 8.2988
Equation number 19 : -13.113
Equation number 20 : -104.64
Equation number 21 : -9.3584
Equation number 22 : 473.7049
Equation number 23 : 20.1
Equation number 24 : 10.5
Equation number 25 : 12.8
Equation number 26 : -11.0304
Equation number 27 : -Inf
Equation number 28 : -676.9264
Equation number 29 : -399.5
Equation number 30 : 9.537
Equation number 31 : 9.8
Equation number 32 : 8.5204
Equation number 33 : 10.9148
Equation number 34 : -100.5
Equation number 35 : 91.34
Equation number 36 : 98.7154
Equation number 37 : 110.3
Equation number 38 : -77802.5945
Equation number 39 : 0
Equation number 40 : NaN
Equation number 41 : 108.06
Equation number 42 : -1185.3603
Equation number 43 : 0
Equation number 44 : 0
Equation number 45 : 0
Equation number 46 : NaN
Equation number 47 : -499.7
Equation number 48 : -0.25
Equation number 49 : -0.03
Equation number 50 : -0.05
Equation number 51 : -0.13

??? Error using ==> print_info at 57
Impossible to find the steady state. Either the model doesn’t have a steady
state, there are an infinity of steady states, or the guess values are too
far from the solution

Error in ==> steady at 92
print_info(info,options_.noprint);

Error in ==> kk1 at 457
steady;

Error in ==> dynare at 120
evalin(‘base’,fname) ;

Please what is the quickest way of reolving this problem. my updated file is attached.
thank you
KK1.mod (3.44 KB)

2

First of all, you did not provide an initval for the variable pm. model_diagnostics says

[quote]The following endogenous variables aren’t present at the current period in the model:
Po
Ps
[/quote]

Apart from that the usual advice applies: try providing better initial values for the steady state computation, or even better, compute the steady state using pencil and paper.

3

thank you alot, but if i am to use pencil and paper how do i take care of the assumed values of variables with lags and leads?

4

It seems that you are not aware what a steady state is. In steady state, all variables are constant, i.e. there are no leads and lags. Just steady state values. Thus, after setting all variables at all leads and lags to their steady state values, you are left with a system of n equations in n unknown steady state values. That is something you can solve for.

5

Hi, I have used pencil and paper to work after reducing the number of equations considerably. I supplied some of the real values i calculated as the initial values that is why many of my residuals are equal to zero but still unable to acheive steady state, please kindly let me know the way to from here. the result i got is as follows:

dynare kk2.mod

Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Local state space iteration (second order).
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
[mex] Quasi Monte-Carlo sequence (Sobol).
[mex] Markov Switching SBVAR.

Starting Dynare (version 4.3.3).
Starting preprocessing of the model file …
Substitution of exo lags: added 5 auxiliary variables and equations.
ERROR: There are 45 equations but 46 endogenous variables!

??? Error using ==> dynare at 114
DYNARE: preprocessing failed

dynare kk2.mod

Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Local state space iteration (second order).
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
[mex] Quasi Monte-Carlo sequence (Sobol).
[mex] Markov Switching SBVAR.

Starting Dynare (version 4.3.3).
Starting preprocessing of the model file …
Substitution of exo lags: added 5 auxiliary variables and equations.
Found 46 equation(s).
Evaluating expressions…done
Computing static model derivatives:

  • order 1
    Computing dynamic model derivatives:
  • order 1
  • order 2
    Processing outputs …done
    Preprocessing completed.
    Starting MATLAB/Octave computing.

Warning: Some of the parameters have no value (gamma) when using steady. If
these parameters are not initialized in a steadystate file, Dynare may not
be able to solve the model…

In test_for_deep_parameters_calibration at 46
In steady at 33
In kk2 at 391
In dynare at 120
Warning: Divide by zero.
In kk2_static at 68
In dynare_solve at 44
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk2 at 391
In dynare at 120
Warning: Divide by zero.
In kk2_static at 208
In dynare_solve at 44
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk2 at 391
In dynare at 120
Warning: Divide by zero.
In kk2_static at 210
In dynare_solve at 44
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk2 at 391
In dynare at 120
STEADY: numerical initial values or parameters incompatible with the following equations
1 2 15

Please check for example
i) if all parameters occurring in these equations are defined
ii) that no division by an endogenous variable initialized to 0 occurs
Warning: Divide by zero.

In kk2_static at 68
In evaluate_static_model at 63
In evaluate_steady_state at 94
In steady_ at 54
In steady at 81
In kk2 at 391
In dynare at 120
Warning: Divide by zero.
In kk2_static at 68
In resid at 75
In steady at 90
In kk2 at 391
In dynare at 120

Residuals of the static equations:

Equation number 1 : NaN
Equation number 2 : NaN
Equation number 3 : -0.14271
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : -0.75
Equation number 8 : -0.9
Equation number 9 : -0.25
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : -0.21927
Equation number 13 : 0
Equation number 14 : 0
Equation number 15 : NaN
Equation number 16 : -0.40432
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 0
Equation number 20 : -0.18912
Equation number 21 : 0
Equation number 22 : 0
Equation number 23 : 0
Equation number 24 : -0.43867
Equation number 25 : -0.009032
Equation number 26 : -0.028764
Equation number 27 : 0
Equation number 28 : 0.9
Equation number 29 : 2.4756
Equation number 30 : 0
Equation number 31 : 0
Equation number 32 : 0
Equation number 33 : 0
Equation number 34 : 0
Equation number 35 : 0
Equation number 36 : 0
Equation number 37 : 0
Equation number 38 : 0
Equation number 39 : 0
Equation number 40 : 0
Equation number 41 : 0

??? Error using ==> print_info at 57
Impossible to find the steady state. Either the model doesn’t have a steady
state, there are an infinity of steady states, or the guess values are too
far from the solution

Error in ==> steady at 92
print_info(info,options_.noprint);

Error in ==> kk2 at 391
steady;

Error in ==> dynare at 120
evalin(‘base’,fname) ;
kk2.mod (2.6 KB)

6

Provide starting values for c, s and yo (anything that is not 0). Moreover, equation 15 is

pO=(theta_o)*s*pof*(yo/O);
But O is an exogenous variable with steady state 0, resulting in a division by 0. You need to fix this.

7

i have to remove equation 15. and i supplied my real values as the initial values of the ones that are not zero but the result i got is: the update file is attached. if you substitute the values of the respective variables for example in equation 3 the value of l will be 0.142708 i did same for others that i supplied their real calculated values.Please what should i do? Thank you.

dynare kk2.mod

Configuring Dynare …
[mex] Generalized QZ.
[mex] Sylvester equation solution.
[mex] Kronecker products.
[mex] Sparse kronecker products.
[mex] Local state space iteration (second order).
[mex] Bytecode evaluation.
[mex] k-order perturbation solver.
[mex] k-order solution simulation.
[mex] Quasi Monte-Carlo sequence (Sobol).
[mex] Markov Switching SBVAR.

Starting Dynare (version 4.3.3).
Starting preprocessing of the model file …
Substitution of exo lags: added 5 auxiliary variables and equations.
Found 45 equation(s).
Evaluating expressions…done
Computing static model derivatives:

  • order 1
    Computing dynamic model derivatives:
  • order 1
  • order 2
    Processing outputs …done
    Preprocessing completed.
    Starting MATLAB/Octave computing.

Warning: Divide by zero.

In solve1 at 122
In dynare_solve at 130
In evaluate_steady_state at 66
In steady_ at 54
In steady at 81
In kk2 at 386
In dynare at 120
??? Error using ==> lnsrch1 at 53
Some element of Newton direction isn’t finite. Jacobian maybe singular or
there is a problem with initial values

Error in ==> solve1 at 129
[x,f,fvec,check]=lnsrch1(xold,fold,g,p,stpmax,func,j1,j2,varargin{:});

Error in ==> dynare_solve at 130
[x,info]=solve1(func,x,j1(r(i):r(i+1)-1),j2(r(i):r(i+1)-1),jacobian_flag,
bad_cond_flag, varargin{:});

Error in ==> evaluate_steady_state at 66
[ys,check] = dynare_solve([M.fname ‘_static’],…

Error in ==> steady_ at 54
[steady_state,params,info] =
evaluate_steady_state(oo_.steady_state,M_,options_,oo_,~options_.steadystate.nocheck);
Error in ==> steady at 81
[steady_state,M_.params,info] = steady_(M_,options_,oo_);

Error in ==> kk2 at 386
steady;

Error in ==> dynare at 120
evalin(‘base’,fname) ;
kk2.mod (2.71 KB)