We propose using a simple Taylor rule to evaluate business cycle convergence of the Czech Republic, Hungary, and Poland … with the Eurozone. Our findings indicate an ongoing convergence of those CEE countries to the Eurozone, but with … instabilities and heterogeneity between the countries. Especially Poland has shown a high degree of convergence in recent years. But …

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 …