This paper focuses on macroeconomic interdependencies between the Euro area and three transition economies (Estonia …, Lithuania and Latvia), with the aim of establishing whether the latter are ready to adopt the Euro. The theoretical framework is … exchange rate vis-à-vis the Euro of each Baltic country, reflecting a degree of real convergence consistent with Optimum …

By estimating a staggered price model over the period 1980q1-2010q2, this paper documents that, after the euro …