This article reports empirical findings on the convergence of the government debt to Gross Domestic Product (GDP) ratio of seven Central and Eastern European (CEE) member states of the European Union (EU) to the European Monetary Union (EMU) over the period 2000 to 2010. This study tests stochastic and b convergence in a time series framework allowing for two structural breaks identified endogenously. The results help to evaluate the distortions in the fiscal convergence process of the CEE countries after the 2008 global financial crisis and the future accession possibilities of each CEE state conditional on the current levels and trends of the debt/GDP ratios.

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We provide an empirical review of fiscal sustainability of Eurozone governments by using quarterly data on debt to Gross Domestic Product (GDP) and primary deficit to GDP over the period 1999 to 2010. We verify the conditions of fiscal sustainability, defined by the government's present value borrowing constraint, by applying unit root tests that involve one, two, or multiple structural breaks. We select the best performing model of structural breaks and group Eurozone governments with respect to fiscal sustainability.

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This paper analyzes the unemployment dynamics of 18 Latin American countries for the last four decades. We use a time series approach to test the mean reversion of unemployment rates and its approximation to a Natural Rate of Unemployment (NRU). The tests include the possibility of one and two structural changes to account for the occurrence of significant macroeconomic changes experienced by the Latin American economies. In addition, we estimate the order of integration of the series, allowing for fractional degrees of differentiation, to assess the persistence of unemployment in the region. Our results indicate that when endogenous structural changes are included in the model, in general we find evidence of mean reversion of unemployment rates for the Latin American countries under study. Therefore, our findings support the structuralist hypothesis of unemployment.