Dear Michel and Sébastien,

currently Dynare substitutes exogenous lags and leads and adds equations. In the attached mod-file (ignore the complex parameter values which are the true problem for now), there are 12 endogenous variables. The preprocessor now says “Substitution of exo leads: added 3 auxiliary variables and equations.”

Running model_diagnostics delivers:

model_diagnostic: the Jacobian of the static model is singular

there is 1 colinear relationships between the variables and the equations

Colinear variables:

c              

k              

y              

l              

mc             

R              

w              

pi             

Colinear equations

     8    14

But originally, there are only 12 equations. Is there a certain rule where the auxiliary equations are included? Are they simply appended at the end so that I know to focus on equation 8 in this case? And how can I tell to which original exogenous variable equation 14 refers to?

If there is no easy answer to those two questions, I would suggest to

- add the name of the original substituted variable as a field in M_.aux_vars, which together with the type stored there should be sufficient for full identification.

- Add the information about where the equations are appended to the Wiki (http://www.dynare.org/DynareWiki/AuxiliaryVariables)

Moreover, regarding the Wiki: could it be that there is a typo and it should be “Aux var for endogenous with lag >= 1” instead of >=2 (and the same for endogenous leads)?

Best,

Johannes

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Johannes Pfeifer

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