This repo contains the Dynare files to simulate a NEw Keynesian DSGE model augmented with liquidity conditions. This model is part of a research project on inflation persistence and monetary policy rules. The main repo for this project is available at this link (to be published soon).
-
nkdtc.mod
contains the model equations and embeds several specifications. It requiresDynare
and needs two flags.-
calibras
= 0 or 1: this flag declare the calibration on the monetary policy rule to be adopted, 0 for the active Central Bank, 0 for the passive one. This flag in turns calls two ancillary files,usual_tp.mod
andpassive_tp.mod
, respectively. Every option of this flag produces and stores simulated time series for inflation and IRFs for selected and full set of variables, with labelling differences. -
z_flag
= 1 activates an end-of-the-world liquidity shock, and needs to be declared with the previous flag. All other values forz_flag
turn off this shock.
-
-
z_graph.m
runs independently and usesnkdtc.mod
as an input. It outputs graphs representing the overall behaviour of the stylised economy under two monetary policy regimes, following the end-of-the-world liquidity shock.
- extract and plot policy function for each model
$\Rightarrow$ Pfeiffer wrote an ad hoc function.