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Hi,

I'm trying to estimate euler equation with delta-beta discount factor (attached workfile)
My input is
c(1)*r(+1)(1-(1-c(2)*apc))(cons_growth^-c(3))-1
Instrument :apc i inflation disp_income

I kept getting Singular Matrix msg.
I searched old thread and found that I should change initial values in which I cant find where.

Any help is much appreciated.

Thank you very much.

Try setting c(2) and c(3) to what you think are reasonable guesses. Double click on the "C" object and enter values as you would for any other object.

Try setting c(2) and c(3) to what you think are reasonable guesses. Double click on the "C" object and enter values as you would for any other object.

Thank you very much for your quick reply