Use of Posteror_function after Estimation to Simulate Endogenous Variables

[jpfeifer]

Now we are back to square one.

@Nirajji25

I thought ‘Smoothed Variables’ obtained after estimation works for that purpose. However, they are exactly the same as observable variables.

I told you this:

Timeseries of endogenous variables relative to steady states

Your answer is still not well-defined. If you want to see how a model matches the data, how do you pick the shocks? If you use the shocks from the Kalman smoother, they will alway perfectly explain the observed data used to run the Kalman smoother.

As long as you don’t know what exactly you are trying to do, there is no answer.