Unit root problem!


#1

Hello, how to get rid of unit root when dealing with prices?

FMI.mod (2.4 KB)


#2

By expression everything in terms of inflation rates and relative prices.


#3

Ok Professor, Let me try …


#4

Professor Can you plz suggest some improvement, while looking at my mod file…

FMI.mod (2.6 KB)


#5

Please have a look at the thread
https://forum.dynare.org/t/unit-root-in-nk-model-how-to-fix/

Reuben