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Fix marginal linearization in the context of...
Fix marginal linearization in the context of perfect_foresight_with_expectation_errors_solver with homotopy If a solution corresponding to 100% of the shock can’t be found in the first informational period, marginal linearization will be performed to extrapolate a solution. However, in subsequent informational periods, this extrapolated solution cannot be used for the initial conditions of endogenous variables, because the initial conditions are not a true solution of the nonlinear model. For those subsequent informational periods, the correct approach is to compute the two solutions needed for marginal linearization using as initial conditions the values obtained in the same two solutions for the previous informational periods (stored as oo_.deterministic_simulation.{sim1,sim2}).
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- matlab/perfect-foresight-models/perfect_foresight_solver.m 42 additions, 19 deletionsmatlab/perfect-foresight-models/perfect_foresight_solver.m
- matlab/perfect-foresight-models/perfect_foresight_with_expectation_errors_solver.m 12 additions, 1 deletion...models/perfect_foresight_with_expectation_errors_solver.m
- meson.build 2 additions, 1 deletionmeson.build
- tests/deterministic_simulations/pfwee_homotopy_linearization.mod 1 addition, 1 deletion...eterministic_simulations/pfwee_homotopy_linearization.mod
- tests/deterministic_simulations/pfwee_homotopy_marginal_linearization.mod 40 additions, 0 deletions...tic_simulations/pfwee_homotopy_marginal_linearization.mod
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