We examine the validity of real interest parity as a long run condition for the G7 countries. If real interest parity holds, differences of real interest rates are stationary. This is investigated by the means of conventional and panel unit root tests, where heterogeneity and contemporaneous...

This paper investigates the Euro-area business cycle using a multivariate autoregressive time series model with cointegration. The cointegration restrictions help to identify permanent and transitory shocks which form the stochastic part of trend and cyclical GDP, respectively. The...