@#define LOGUTILITY = 1 
var y c g i x k f n r w mc lambda a ;  %  endogenous variables
varexo eps_g eps_a eps_x;  %  exogenous shocks
parameters beta gamma chi delta kappa alpha omega kappa_f delta_f rhoa rhog z rhox;  %  parameters

% Parameter calibration 
beta = 0.85;
gamma = 0.5;
chi = 1;
delta = 0.025;
kappa = 0.02;
alpha = 0.36;
omega = 0.5;
kappa_f = 0.02;
delta_f = 0.025;
rhoa = 0.58;
rhog = 0.17;
rhox = 0.3; 
z = 0.35;

% Model equations
model;
  y = c + g + i + x; % Equation (1)

   c + gamma * g = (c(+1) + gamma * g(+1)) / (beta * (1 + r(+1))); % Equation (2)

   lambda = beta * (c(+1) + gamma*g(+1)*(1-delta+r(+1)));   % Equation (4)
   n = 1 - chi / ( beta * (c(+1) + gamma*g(+1)*(1-delta+r(+1))) * w * (1 - z));% Equation (3)

  k(+1) = (1-delta)*k + (1-kappa/2*((i/i(-1))-1)^2)*i;  % Equation (5)

  f(+1) = (1-delta_f)*f + (1-kappa_f/2*((x/x(-1))-1)^2)*x;   % Equation (6)

  r = alpha * (y/k);  % Equation (7)

  w = mc*(1-alpha) * (y/n); % Equation (8)

  y = a * k^alpha * f^omega * n^(1-alpha); % Equation (9)

  mc = 1; % Equation (10)
  log(a) = rhoa*log(a(-1)) + eps_a; % Equation (12)
  log(g) = rhog*log(g(-1)) + eps_g;  % Equation (11)
  log(x) = rhox*log(x(-1)) + eps_x;  % Equation (14)
end;

% ------------------------ %
% Steady State Computation %
% ------------------------ %
@#define AnalyticalSteadyState =1

@#if AnalyticalSteadyState == 1
  steady_state_model;
  a = 1;
  y = 1;
  c = 0.2;
  g = 0.2;
  i = 0.4;
  x = 0.2;
  r = 1/beta - 1;
  mc = 1;
  n = 0.35;
  w = mc*(1-alpha) * (y/n); 
  k = 10;
  f = 10;
end;
steady;
resid;
@#else 
@#endif

% Stochastic shocks
shocks;
  var eps_g = 0.015^2;  % Government shock
  var eps_a = 0.052^2;  % Exogenous shock
  var eps_x = 0.01^2;   % Investment shock
end;

% Solve and simulate the model
stoch_simul(order=1, irf=20);