Commit 0d8fce08 authored by Johannes Pfeifer's avatar Johannes Pfeifer
Browse files

Improve on documentation regarding treatment of predetermined variables

parent 025f0d5b
......@@ -1166,6 +1166,20 @@ are supposed to be decided one period ahead of all other endogenous
variables. For stock variables, they are supposed to follow a ``stock at
the beginning of the period'' convention.
Note that Dynare internally always uses the ``stock at the end of the period''
concept, even when the model has been entered using the
@code{predetermined_variables}-command. Thus, when plotting,
computing or simulating variables, Dynare will follow the convention to
use variables that are decided in the current period. For example,
when generating impulse response functions for capital, Dynare
will plot @code{k}, which is the capital stock decided upon by
investment today (and which will be used in tomorrow's production function).
This is the reason that capital is shown to be moving on impact, because
it is @code{k} and not the predetermined @code{k(-1)} that is displayed.
It is important to remember that this also affects simulated time
series and output from smoother routines for predetermined variables.
Compared to non-predetermined variables they might otherwise appear
to be falsely shifted to the future by one period.
@examplehead
The following two program snippets are strictly equivalent.
......
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