Gaussian time-series models are often specified through their spectral density. Such models pose several computational challenges, in particular because of the non-sparse nature of the covariance matrix. We derive a fast approximation of the likelihood for such models. We use importance sampling...

We apply the Pesaran (2007) pair-wise approach of convergence to the per capita outputs of 195 European regions for the period 1980–2006. Pesaran's approach is based on the computation of the percentage ratio of output gaps which fulfil a given convergence criterion. A high ratio will be...