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Sovereign Debt Crisis Tightening Its Grip on the Real Economy. Economic Outlook for 2012 and 2013


  • Marcus Scheiblecker



In response to the sovereign debt crisis in the euro area, many member countries apply cuts to their government finances. This will weigh on internal demand and output growth in the euro area, at a time when also the cyclical momentum of the global economy decelerates. For the year to come, economic growth in the euro area is thus expected to come to a halt, and business activity in Austria is about to slacken. Real GDP growth in Austria is forecasted to moderate from 3.2 percent to 0.4 percent in 2012. Only in 2013 will the international upturn lead to a rebound in GDP growth to an expected rate of 1.6 percent. While headline inflation should decline markedly in 2012, the cyclical downturn will take its toll on the labour market, with employment growth levelling off and unemployment heading up.

Suggested Citation

  • Marcus Scheiblecker, 2012. "Sovereign Debt Crisis Tightening Its Grip on the Real Economy. Economic Outlook for 2012 and 2013," Austrian Economic Quarterly, WIFO, vol. 17(1), pages 1-11, February.
  • Handle: RePEc:wfo:wquart:y:2012:i:1:p:1-11

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    References listed on IDEAS

    1. Megginson, William Leon, 2005. "The Financial Economics of Privatization," OUP Catalogue, Oxford University Press, number 9780195150629.
    2. Vining, Aidan R & Boardman, Anthony E, 1992. "Ownership versus Competition: Efficiency in Public Enterprise," Public Choice, Springer, vol. 73(2), pages 205-239, March.
    3. Patrick W. Schmitz, 2000. "Partial Privatization and Incomplete Contracts: The Proper Scope of Government Reconsidered," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 57(4), pages 394-411, August.
    4. Susanne Sieber, 2008. "Österreichs Attraktivität für ausländische Direktinvestitionen sowie als Standort für Headquarters Funktionen," FIW Research Reports series I-021, FIW.
    5. Ros, Agustin J, 1999. "Does Ownership or Competition Matter? The Effects of Telecommunications Reform on Network Expansion and Efficiency," Journal of Regulatory Economics, Springer, vol. 15(1), pages 65-92, January.
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    1. Marcus Scheiblecker, 2012. "Sovereign Debt Crisis Tightening Its Grip on the Real Economy. Economic Outlook for 2012 and 2013," WIFO Monatsberichte (monthly reports), WIFO, pages 3-15.

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