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thorek1 committed Nov 22, 2023
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Expand Up @@ -123,6 +123,7 @@ Let's check out the non stochastic steady state (NSSS):

```@repl howto_obc
SS(Gali_2015_chapter_3_obc)
SS(Gali_2015_chapter_3_obc)(:R)
```

There are a few things to note here. First, we get the NSSS values of the auxilliary variables related to the occasionally binding constraint. Second, the NSSS value of `R` is 1, and thereby the effective lower bound is binding in the NSSS. While this is a viable NSSS it is not a viable approximation point for perturbation. We can only find a perturbation solution if the effective lower bound is not binding in NSSS. Calling `get_solution` reveals that there is no stable solution at this NSSS:
Expand Down Expand Up @@ -226,6 +227,7 @@ and check the NSSS once more:

```@repl howto_obc
SS(Gali_2015_chapter_3_obc)
SS(Gali_2015_chapter_3_obc)(:R)
```

Now we get `R > R̄`, so that the constraint is not binding in the NSSS and we can work with a stable first order solution:
Expand Down Expand Up @@ -316,12 +318,14 @@ Statistics.std(sims(:Y,:,:))
Compare this to the theoretical mean of the model without the occasionally binding constraint:

```@repl howto_obc
get_mean(Gali_2015_chapter_3_obc)
get_mean(Gali_2015_chapter_3_obc)(:Y)
```

and the theoretical standard deviation:

```@repl howto_obc
get_std(Gali_2015_chapter_3_obc)
get_std(Gali_2015_chapter_3_obc)(:Y)
```

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