Ertl, Martin; Rabitsch, Katrin - 2024
convergence, then growth, say, from technological progress will be lower than we find in the data and, hence, r* will be lower …. Ignoring convergence upwardly biases our estimates of r* . We extend the New Keynesian small open economy model to take account … of convergence. The model is estimated with Bayesian techniques for four emerging economies in Central and Eastern Europe …