Transition and Convergence in Central and Eastern Europe

The paper provides an analysis of the convergence in selected macroeconomic fundamentals of several Central and East European (CEE) countries. The selected CEE countries are categorized to reflect the respective institutional and geographical aspects of economic transformation in the region. Convergence in macroeconomic fundamentals among the transition countries was confirmed in general. Common institutional features and common economic policies tend to correlate with a higher degree of convergence. This finding is in line with neoclassical growth theory, which supports the occurrence of convergence among similar countries.