diff --git a/matlab/DsgeLikelihood.m b/matlab/DsgeLikelihood.m
index c3306bb05..b3e4808c9 100644
--- a/matlab/DsgeLikelihood.m
+++ b/matlab/DsgeLikelihood.m
@@ -119,7 +119,7 @@ function [fval,cost_flag,ys,trend_coeff,info] = DsgeLikelihood(xparam1,gend,data
     cost_flag = 0;
     return
   elseif info(1) == 3 | info(1) == 4 | info(1) == 20
-    fval = bayestopt_.penalty+info(2)^2;
+    fval = bayestopt_.penalty+info(2);%^2; % penalty power raised in DR1.m and resol already. GP July'08
     cost_flag = 0;
     return
   end