Unemployment and common smooth transition trends in Central and Eastern European Countries

Juan Carlos Cuestas () and Javier Ordóñez ()

Working Papers from Nottingham Trent University, Nottingham Business School, Economics Division

Abstract: In the present paper we analyse the existence of common nonlinear trends in several of Central and Eastern European Countries in order to gain some insight about the degree of labour market integration within the area. In order to do so, we test for the order of integration of the unemployment rates, by applying the Leybourne et al. (1998) and Kapetanios et al. (2003) nonlinear unit root tests. Our results pinpoint the fact that five up to eight unemployment rates are stationary around a nonlinear trend and, by means of Anderson and Vahid (1998) approach, we also find that there is a common trend that drives the long run behaviour of that variable in these countries.

Keywords: Unemployment; Central and Eastern Europe; unit roots; smooth transition; nonlinearities. (search for similar items in EconPapers)
JEL-codes: C32 E24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eec, nep-lab and nep-tra
Date: 2009-07
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http://www.ntu.ac.uk/research/document_uploads/87123.pdf First version, 2009 (application/pdf)

Related works:
Journal Article: Unemployment and common smooth transition trends in Central and Eastern European Countries (2011)
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Persistent link: http://EconPapers.repec.org/RePEc:nbs:wpaper:2009/5

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