variables. Shock decompositions of the output and the inflation rate revealed the driving forces of the business cycles; demand …), whereas prices were also driven by supply and monetary policy shocks, the latter being more important for Poland …

admission to the European Union (EU), Poland and Hungary. Using a rational expectations, dynamic open economy aggregate supply … price level movements in Poland. Monetary shocks are an important source of output fluctuations in the short run in Hungary … suggesting nominal inertia. In Poland, real demand shocks affect output in the short run (up to one year), while monetary shocks …