A training ground for the new generation of Eastern European economic chiefs has become the first postgraduate school in the former Soviet bloc to gain a United States stamp of approval.

Prague's Centre for Economics Research and Graduate Education and Economics Institute, founded in 1991, has won accreditation from the New York State Education Department after an inspection by leading US economists and academics.

The evaluation, by a team that included Chicago 51¹ú²úÊÓƵ economics professor and president of the American Economic Association Sherwin Rosen, and Michael Rothschild, a Princeton 51¹ú²úÊÓƵ economics dean, said the economics PhD programme was "on a par with very good US programmes" and commended the institute "for its flexibility and innovation and for the acuteness of its leaders in understanding its market niche and problems".

The team recommended accreditation by New York "with the highest level of enthusiasm".

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The institute is jointly governed by Charles 51¹ú²úÊÓƵ and the Czech Academy of Sciences.

The report and accreditation should help graduates find top positions and attract more sponsors, said Randall Filer, president of the institute's foundation and a key fundraiser. Dr Filer, who taught at the institute for three years before returning to City 51¹ú²úÊÓƵ New York, said the importance of the accreditation lay in its value as an imprimatur.

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"We care about New York because the students, particularly those from further east in the former Soviet Union, tell us that American accreditation carries a stamp of approval that is important within their cultures."

The institute's reputation for turning out graduates who move directly into positions of public or corporate prominence is already established: students typically find jobs as chief country economists or heads of research. "When Milton Friedman came to lecture in Prague, I noticed in the audience three of our students, all under 28 and still studying: one was the chief economist with the Czech ministry of trade and industry; another the personal economic adviser to President Vaclav Havel; and the third worked for the then prime minister Vaclav Klaus," Dr Filer said.

Housed in a 19th-century palace modelled on Versailles, near Wenceslas Square, the institute is supported by the Czech education ministry and sponsors include the World Bank, Citigroup, Coca-Cola, Philip Morris and Siemens.

About 40 of 300 applicants from more than 20 countries throughout Eastern Europe are taken on to the economics PhD programme each year, with most taking about six years to complete their studies.

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The institutes courses are taught in English, with intensive English as a second language tutoring focused on clear communicative writing.