IDEAS home Printed from https://ideas.repec.org/a/kap/empiri/v41y2014i3p445-465.html
   My bibliography  Save this article

A low growth path in Austria: potential causes, consequences and policy options

Author

Listed:

Abstract

This paper reports on an Austrian research project that deals with the question how the Austrian society could cope with long-lasting low economic growth. Various causes of low-growth that are relevant for Austria (a deteriorating balance of trade, increasing resource prices, consumer restraint of households and less immigration) have been identified, leading to an only moderate gross domestic product growth of 0.55 % per year. The resulting impact on the economy is substantial: the labour market suffers from a shortage of labour supply (due to reduced migration) and from a reduced demand for labour (due to reduced demand in consumption, investments and exports). Subsequently, less employment decreases the development of the disposable income of private households (tax rates and social security contributions held constant). Related to this, public debt is higher due to reduced tax incomes and slightly growing public expenditures. From an ecological perspective, resource consumption increases at a slower rate, however, no absolute reduction can be reached. CO 2 emissions also slightly increase. Therefore, it cannot be assumed that low growth necessarily leads to the achievement of energy and environmental policy goals. Based on these results, a policy scenario was used to analyze whether and how policy measures are able to cope with the negative consequences of persistent low growth. The results reveal that the selected measures are suitable to reduce negative economic effects: The implementation of reduced working time and an eco-social reform of levies might improve the labour market situation. The negative effects on the national budget can be diminished by a reduction of environmentally harmful subsidies. Induced behaviour changes of private households can reduce energy and resource-intensive consumption. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Andrea Stocker & Anett Großmann & Friedrich Hinterberger & Marc Wolter, 2014. "A low growth path in Austria: potential causes, consequences and policy options," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(3), pages 445-465, August.
  • Handle: RePEc:kap:empiri:v:41:y:2014:i:3:p:445-465
    DOI: 10.1007/s10663-014-9267-x
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10663-014-9267-x
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jochen Hartwig, 2005. "Messprobleme bei der Ermittlung des Wachstums der Arbeitsproduktivität - dargestellt anhand eines Vergleichs der Schweiz mit den USA," KOF Working papers 05-100, KOF Swiss Economic Institute, ETH Zurich.
    2. Stocker, Andrea & Großmann, Anett & Madlener, Reinhard & Wolter, Marc Ingo, 2011. "Sustainable energy development in Austria until 2020: Insights from applying the integrated model "e3.at"," Energy Policy, Elsevier, vol. 39(10), pages 6082-6099, October.
    3. Bernd Meyer & Christian Lutz & Peter Schnur & Gerd Zika, 2007. "National Economic Policy Simulations with Global Interdependencies: A Sensitivity Analysis for Germany," Economic Systems Research, Taylor & Francis Journals, vol. 19(1), pages 37-55.
    4. repec:wfo:wstudy:34981 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Economic growth; Macroeconomics; Sustainability; Sustainable economy; Modelling; E27; O44; Q57;

    JEL classification:

    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:empiri:v:41:y:2014:i:3:p:445-465. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.