Why Does Austria's Economy Grow Faster than Germany's?
AbstractGermany and Austria, neighbours of different size and with the same language, still have close economic bonds, but the combined effect of Austria joining the EU, the eastern opening and the EU's enlargement has made Austria grow increasingly separate from Germany. Since the early 1990s, Austria's economic growth rate has been surpassing the German equivalent by ½ percentage point per year. The reasons for this are manifold, but appear to be chiefly in the burden attending German reunification. Also, the German business sector seems to have been less able than its Austrian counterpart to tap the new opportunities springing from Europe's progressing integration (internal market and currency union) and the EU's enlargement. Already the eastern opening opened up a new "window of opportunity" for Austria which the economy made full use of. In part, the asymmetric architecture of EMU's macropolicy (excessive real interest rates, fiscal rules of the stability and growth pact) appears to pose greater problems for Germany than for Austria. Lastly, the negative structural effects of globalisation (outsourcing, etc.) may have been a reason for Germany's weak growth. However, since the globalisation effect also applies to Austria, the growth gap between the two countries cannot be explained by this hypothesis.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by WIFO in its series WIFO Working Papers with number 280.
Length: 88 pages
Date of creation: 10 Oct 2006
Date of revision:
Deutschland; Österreich; Wirtschaftsvergleich; Globalisierung;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-08-27 (All new papers)
- NEP-EEC-2007-08-27 (European Economics)
- NEP-MAC-2007-08-27 (Macroeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Robert Kollmann, 2004.
"Welfare Effects of a Monetary Union: The Role of Trade Openness,"
Journal of the European Economic Association,
MIT Press, vol. 2(2-3), pages 289-301, 04/05.
- Robert Kollmann, 2004. "Welfare effects of a monetary union: the role of trade openness," ULB Institutional Repository 2013/7626, ULB -- Universite Libre de Bruxelles.
- Helge Berger & Volker Nitsch, 2005.
"Zooming Out: The Trade Effect of the Euro in Historical Perspective,"
CESifo Working Paper Series
1435, CESifo Group Munich.
- Berger, Helge & Nitsch, Volker, 2008. "Zooming out: The trade effect of the euro in historical perspective," Journal of International Money and Finance, Elsevier, vol. 27(8), pages 1244-1260, December.
- Berger, Helge & Nitsch, Volker, 2005. "Zooming Out: The Trade Effect of the EURO in Historical Perspective," Discussion Papers 2005/5, Free University Berlin, School of Business & Economics.
- Alejandro Micco & Ernesto Stein & Guillermo OrdoÒez, 2003.
"The currency union effect on trade: early evidence from EMU,"
CEPR & CES & MSH, vol. 18(37), pages 315-356, October.
- Alejandro Micco & Ernesto H. Stein & Guillermo Luis Ordoñez, 2003. "The Currency Union Effect on Trade: Early Evidence from EMU," Research Department Publications 4339, Inter-American Development Bank, Research Department.
- Hughes Hallett, A. & Ma, Y. & Melitz, J., 1996.
"Unification and the policy predicament in Germany,"
Elsevier, vol. 13(4), pages 519-544, October.
- Hughes Hallett, Andrew & Ma, Yue & Mélitz, Jacques, 1994. "Unification and the Policy Predicament in Germany," CEPR Discussion Papers 956, C.E.P.R. Discussion Papers.
- Hughes Hallett, A & Ma, Y & Melitz, J, 1995. "Unification and the Policy Predicament in Gemany," Papers 01, American Institute for Contemporary German Studies-.
- Andrew K. Rose, 2001. "Currency unions and trade: the effect is large," Economic Policy, CEPR & CES & MSH, vol. 16(33), pages 449-461, October.
- Arjan M. Lejour & Ruud A. de Mooij & Richard Nahuis, 2001.
"EU Enlargement: Economic Implications for Countries and Industries,"
CESifo Working Paper Series
585, CESifo Group Munich.
- Arjan Lejour & Ruud de Mooij & Richard Nahuis, 2001. "EU enlargement: economic implications for countries and industries," CPB Document 11, CPB Netherlands Bureau for Economic Policy Analysis.
- Brown, D. & Deardorff & A. & Djankov, S. & Stern, R., 1995.
"An Economic Assessment of the Integration of Czechoslovakia, Hungary and Poland into the European Union,"
8, American Institute for Contemporary German Studies-.
- Deardoff, A.V. & Brown, D.K. & Stern, R.M. & Djankov, S.D., 1995. "An Economic Assessment of the Integration of Czechoslovakia, Hungary, and Poland into the Europan Union," Working Papers 380, Research Seminar in International Economics, University of Michigan.
- Andrew K. Rose & Eric van Wincoop, 2001. "National Money as a Barrier to International Trade: The Real Case for Currency Union," American Economic Review, American Economic Association, vol. 91(2), pages 386-390, May.
- Carone, Giuseppe & Denis, Cécile & Mc Morrow, Kieran & Mourre, Gilles & Röger, Werner, 2006.
"Long-term labour productivity and GDP projections for the EU25 Member States : a production function framework,"
744, University Library of Munich, Germany.
- Giuseppe Carone & C�cile Denis & Kieran Mc Morrow & Gilles Mourre & Werner R�ger, 2006. "Long-term labour productivity and GDP projections for the EU25 Member States : a production function framework," European Economy - Economic Papers 253, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
- Boris Majcen & Miroslav Verbic & Sasa Knezevic, 2005. "The Effects of Foreign Trade Liberalization and Financial Flows between Slovenia and the EU after the Accession," International Trade 0501011, EconWPA.
- Davis, Donald R, 1998. "Does European Unemployment Prop Up American Wages? National Labor Markets and Global Trade," American Economic Review, American Economic Association, vol. 88(3), pages 478-94, June.
- Andrew K. Rose, 2000. "One money, one market: the effect of common currencies on trade," Economic Policy, CEPR & CES & MSH, vol. 15(30), pages 7-46, 04.
- Brecher, Richard A., 1974. "Optimal commercial policy for a minimum-wage economy," Journal of International Economics, Elsevier, vol. 4(2), pages 139-149, May.
- Richard E. Baldwin & Joseph F. Francois & Richard Portes, 1997. "The costs and benefits of eastern enlargement: the impact on the EU and central Europe," Economic Policy, CEPR & CES & MSH, vol. 12(24), pages 125-176, 04.
- Torsten Persson, 2001. "Currency unions and trade: how large is the treatment effect?," Economic Policy, CEPR & CES & MSH, vol. 16(33), pages 433-462, October.
- Reinhard Neck & Gottfried Haber & Warwick Mckibbin, 2000. "Macroeconomic impacts of European union membership of central and eastern European economies," Atlantic Economic Journal, International Atlantic Economic Society, vol. 28(1), pages 71-82, March.
- Fritz Breuss, 2002. "Benefits and Dangers of EU Enlargement," Empirica, Springer, vol. 29(3), pages 245-274, September.
- Arndt, Sven & Handler, Heinz & Salvatore, Dominick, 2000. "Eastern enlargement: the sooner, the better?," MPRA Paper 44943, University Library of Munich, Germany.
- Brecher, Richard A, 1974. "Minimum Wage Rates and the Pure Theory of International Trade," The Quarterly Journal of Economics, MIT Press, vol. 88(1), pages 98-116, February.
- Sinn, Gerlinde & Sinn, Hans-Werner, 1992. "Kaltstart. Volkswirtschaftliche Aspekte der Deutschen Vereinigung," Monograph, Mohr Siebeck, Tübingen, edition 2, number urn:isbn:9783161459429, February.
- Harald Badinger & Fritz Breuss, 2004. "What has determined the rapid post-war growth of intra-EU trade?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 140(1), pages 31-51, March.
- Wolfgang Ochel & Oliver Röhn, 2006. "Ranking of Countries - The WEF, IMD, Fraser and Heritage Indices," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 4(2), pages 48-60, 07.
- Line Vogt, 2005. "The EU's Single Market: At Your Service?," OECD Economics Department Working Papers 449, OECD Publishing.
- Flam, Harry & Nordström, Håkan, 2006. "Trade Volume Effects of the Euro: Aggregate and Sector Estimates," Seminar Papers 746, Stockholm University, Institute for International Economic Studies.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ilse Schulz).
If references are entirely missing, you can add them using this form.