diff --git a/preprocessor/ComputingTasks.cc b/preprocessor/ComputingTasks.cc
index cabfed99c..3f27dbc4a 100644
--- a/preprocessor/ComputingTasks.cc
+++ b/preprocessor/ComputingTasks.cc
@@ -138,6 +138,50 @@ PerfectForesightSolverStatement::writeOutput(ostream &output, const string &base
   output << "perfect_foresight_solver;" << endl;
 }
 
+PriorPosteriorFunctionStatement::PriorPosteriorFunctionStatement(const OptionsList &options_list_arg) :
+  options_list(options_list_arg)
+{
+}
+
+void
+PriorPosteriorFunctionStatement::checkPass(ModFileStructure &mod_file_struct, WarningConsolidation &warnings)
+{
+  // Fill in option_occbin of mod_file_struct
+  OptionsList::num_options_t::const_iterator it = options_list.num_options.find("prior");
+  OptionsList::num_options_t::const_iterator it1 = options_list.num_options.find("posterior");
+  if ((it == options_list.num_options.end() && it1 == options_list.num_options.end())
+      || (it != options_list.num_options.end() && it1 != options_list.num_options.end()))
+      {
+          cerr << "ERROR: prior_posterior_function requires one of 'prior' or 'posterior'" << endl;
+          exit(EXIT_FAILURE);
+      }
+
+  OptionsList::string_options_t::const_iterator it2 = options_list.string_options.find("function");
+  if (it2 == options_list.string_options.end() || it2->second.empty())
+      {
+          cerr << "ERROR: prior_posterior_function requires the function argument" << endl;
+          exit(EXIT_FAILURE);
+      }
+}
+
+void
+PriorPosteriorFunctionStatement::writeOutput(ostream &output, const string &basename, bool minimal_workspace) const
+{
+  OptionsList::num_options_t::const_iterator it =
+      options_list.num_options.find("prior_posterior_sampling_draws");
+  if (it != options_list.num_options.end())
+      cout << it->first << " = " << it->second << ";" << endl;
+
+  string type = "posterior";
+  if (options_list.num_options.find("prior") != options_list.num_options.end())
+      type = "prior";
+
+  output << "oo_ = execute_prior_posterior_function("
+         << "'" << options_list.string_options.find("function")->second << "',"
+         << "M_, options_, oo_, estim_params_, bayestopt_, dataset_, dataset_info, "
+         << "'" << type << "');" << endl;
+}
+
 StochSimulStatement::StochSimulStatement(const SymbolList &symbol_list_arg,
                                          const OptionsList &options_list_arg) :
   symbol_list(symbol_list_arg),
diff --git a/preprocessor/ComputingTasks.hh b/preprocessor/ComputingTasks.hh
index 111f565fd..a963be8cf 100644
--- a/preprocessor/ComputingTasks.hh
+++ b/preprocessor/ComputingTasks.hh
@@ -77,6 +77,16 @@ public:
   virtual void writeOutput(ostream &output, const string &basename, bool minimal_workspace) const;
 };
 
+class PriorPosteriorFunctionStatement : public Statement
+{
+private:
+  const OptionsList options_list;
+public:
+  PriorPosteriorFunctionStatement(const OptionsList &options_list_arg);
+  virtual void checkPass(ModFileStructure &mod_file_struct, WarningConsolidation &warnings);
+  virtual void writeOutput(ostream &output, const string &basename, bool minimal_workspace) const;
+};
+
 class ModelInfoStatement : public Statement
 {
 private:
diff --git a/preprocessor/DynareBison.yy b/preprocessor/DynareBison.yy
index 925e7c14a..45f2c9206 100644
--- a/preprocessor/DynareBison.yy
+++ b/preprocessor/DynareBison.yy
@@ -114,7 +114,7 @@ class ParsingDriver;
 %token NOGRAPH NOMOMENTS NOPRINT NORMAL_PDF SAVE_DRAWS
 %token OBSERVATION_TRENDS OPTIM OPTIM_WEIGHTS ORDER OSR OSR_PARAMS MAX_DIM_COVA_GROUP ADVANCED OUTFILE OUTVARS OVERWRITE
 %token PARALLEL_LOCAL_FILES PARAMETERS PARAMETER_SET PARTIAL_INFORMATION PERFECT_FORESIGHT PERIODS PERIOD PLANNER_OBJECTIVE PLOT_CONDITIONAL_FORECAST PLOT_PRIORS PREFILTER PRESAMPLE
-%token PERFECT_FORESIGHT_SETUP PERFECT_FORESIGHT_SOLVER NO_POSTERIOR_KERNEL_DENSITY
+%token PERFECT_FORESIGHT_SETUP PERFECT_FORESIGHT_SOLVER NO_POSTERIOR_KERNEL_DENSITY FUNCTION
 %token PRINT PRIOR_MC PRIOR_TRUNC PRIOR_MODE PRIOR_MEAN POSTERIOR_MODE POSTERIOR_MEAN POSTERIOR_MEDIAN PRUNING
 %token <string_val> QUOTED_STRING
 %token QZ_CRITERIUM QZ_ZERO_THRESHOLD FULL DSGE_VAR DSGE_VARLAG DSGE_PRIOR_WEIGHT TRUNCATE
@@ -147,7 +147,7 @@ class ParsingDriver;
 %token VLISTLOG VLISTPER SPECTRAL_DENSITY
 %token RESTRICTION RESTRICTION_FNAME CROSS_RESTRICTIONS NLAGS CONTEMP_REDUCED_FORM REAL_PSEUDO_FORECAST
 %token DUMMY_OBS NSTATES INDXSCALESSTATES NO_BAYESIAN_PRIOR SPECIFICATION SIMS_ZHA
-%token <string_val> ALPHA BETA ABAND NINV CMS NCMS CNUM GAMMA INV_GAMMA INV_GAMMA1 INV_GAMMA2 NORMAL UNIFORM EPS PDF FIG DR NONE PRIOR PRIOR_VARIANCE HESSIAN IDENTITY_MATRIX DIRICHLET
+%token <string_val> ALPHA BETA ABAND NINV CMS NCMS CNUM GAMMA INV_GAMMA INV_GAMMA1 INV_GAMMA2 NORMAL UNIFORM EPS PDF FIG DR NONE PRIOR POSTERIOR PRIOR_VARIANCE HESSIAN IDENTITY_MATRIX DIRICHLET
 %token GSIG2_LMDM Q_DIAG FLAT_PRIOR NCSK NSTD WEIBULL WEIBULL_PDF
 %token INDXPARR INDXOVR INDXAP APBAND INDXIMF IMFBAND INDXFORE FOREBAND INDXGFOREHAT INDXGIMFHAT
 %token INDXESTIMA INDXGDLS EQ_MS FILTER_COVARIANCE FILTER_DECOMPOSITION
@@ -162,7 +162,7 @@ class ParsingDriver;
 %token SELECTED_VARIABLES_ONLY COVA_COMPUTE SIMULATION_FILE_TAG FILE_TAG
 %token NO_ERROR_BANDS ERROR_BAND_PERCENTILES SHOCKS_PER_PARAMETER NO_CREATE_INIT
 %token SHOCK_DRAWS FREE_PARAMETERS MEDIAN DATA_OBS_NBR NEIGHBORHOOD_WIDTH PVALUE_KS PVALUE_CORR
-%token FILTERED_PROBABILITIES REAL_TIME_SMOOTHED
+%token FILTERED_PROBABILITIES REAL_TIME_SMOOTHED PRIOR_POSTERIOR_FUNCTION PRIOR_POSTERIOR_SAMPLING_DRAWS
 %token PROPOSAL_TYPE PROPOSAL_UPPER_BOUND PROPOSAL_LOWER_BOUND PROPOSAL_DRAWS USE_MEAN_CENTER
 %token ADAPTIVE_MH_DRAWS THINNING_FACTOR COEFFICIENTS_PRIOR_HYPERPARAMETERS
 %token CONVERGENCE_STARTING_VALUE CONVERGENCE_ENDING_VALUE CONVERGENCE_INCREMENT_VALUE
@@ -281,6 +281,7 @@ statement : parameters
           | histval_file
           | perfect_foresight_setup
           | perfect_foresight_solver
+          | prior_posterior_function
           ;
 
 dsample : DSAMPLE INT_NUMBER ';'
@@ -1022,6 +1023,20 @@ perfect_foresight_solver_options : o_stack_solve_algo
 				 | o_occbin
                                  ;
 
+prior_posterior_function : PRIOR_POSTERIOR_FUNCTION '(' prior_posterior_function_options_list ')' ';'
+                          { driver.prior_posterior_function(); }
+                         ;
+
+prior_posterior_function_options_list : prior_posterior_function_options_list COMMA prior_posterior_function_options
+                                      | prior_posterior_function_options
+                                      ;
+
+prior_posterior_function_options : o_function
+                                 | o_prior
+                                 | o_posterior
+                                 | o_prior_posterior_sampling_draws
+                                 ;
+
 simul : SIMUL ';'
         { driver.simul(); }
       | SIMUL '(' simul_options_list ')' ';'
@@ -3065,7 +3080,11 @@ o_period : PERIOD EQUAL INT_NUMBER { driver.option_num("period", $3); };
 o_outfile : OUTFILE EQUAL filename { driver.option_str("outfile", $3); };
 o_outvars : OUTVARS EQUAL '(' symbol_list ')' { driver.option_symbol_list("outvars"); };
 o_lmmcp : LMMCP {driver.option_num("lmmcp", "1"); }; 
-o_occbin : OCCBIN {driver.option_num("occbin", "1"); }; 
+o_occbin : OCCBIN {driver.option_num("occbin", "1"); };
+o_function : FUNCTION EQUAL filename { driver.option_str("function", $3); };
+o_prior : PRIOR { driver.option_num("prior", "1"); };
+o_posterior : POSTERIOR { driver.option_num("posterior", "1"); };
+o_prior_posterior_sampling_draws : PRIOR_POSTERIOR_SAMPLING_DRAWS EQUAL INT_NUMBER { driver.option_num("prior_posterior_sampling_draws",$3); };
 
 range : symbol ':' symbol
         {
@@ -3210,6 +3229,7 @@ symbol : NAME
        | NONE
        | DR
        | PRIOR
+       | POSTERIOR
        ;
 %%
 
diff --git a/preprocessor/DynareFlex.ll b/preprocessor/DynareFlex.ll
index 82209584a..72aeb64ec 100644
--- a/preprocessor/DynareFlex.ll
+++ b/preprocessor/DynareFlex.ll
@@ -214,8 +214,15 @@ DATE -?[0-9]+([YyAa]|[Mm]([1-9]|1[0-2])|[Qq][1-4]|[Ww]([1-9]{1}|[1-4][0-9]|5[0-2
   yylval->string_val = new string(yytext);
   return token::PRIOR;
 }
+<DYNARE_STATEMENT>posterior {
+  yylval->string_val = new string(yytext);
+  return token::POSTERIOR;
+}
 <INITIAL>std {BEGIN DYNARE_STATEMENT; return token::STD;}
 <INITIAL>corr {BEGIN DYNARE_STATEMENT; return token::CORR;}
+<DYNARE_STATEMENT>function {return token::FUNCTION;}
+<DYNARE_STATEMENT>prior_posterior_sampling_draws {return token::PRIOR_POSTERIOR_SAMPLING_DRAWS;}
+<INITIAL>prior_posterior_function {BEGIN DYNARE_STATEMENT; return token::PRIOR_POSTERIOR_FUNCTION;}
 
  /* Inside  of a Dynare statement */
 <DYNARE_STATEMENT>{DATE} {
diff --git a/preprocessor/ParsingDriver.cc b/preprocessor/ParsingDriver.cc
index 1880c1276..298d774a9 100644
--- a/preprocessor/ParsingDriver.cc
+++ b/preprocessor/ParsingDriver.cc
@@ -2797,6 +2797,13 @@ ParsingDriver::perfect_foresight_solver()
   options_list.clear();
 }
 
+void
+ParsingDriver::prior_posterior_function()
+{
+  mod_file->addStatement(new PriorPosteriorFunctionStatement(options_list));
+  options_list.clear();
+}
+
 void
 ParsingDriver::add_ramsey_constraints_statement()
 {
diff --git a/preprocessor/ParsingDriver.hh b/preprocessor/ParsingDriver.hh
index cd1a782d4..f9dd4912c 100644
--- a/preprocessor/ParsingDriver.hh
+++ b/preprocessor/ParsingDriver.hh
@@ -702,7 +702,8 @@ public:
   void smoother2histval();
   void histval_file(string *filename);
   void perfect_foresight_setup();
-  void perfect_foresight_solver();  
+  void perfect_foresight_solver();
+  void prior_posterior_function();
 };
 
 #endif // ! PARSING_DRIVER_HH