Alternative Strategien der Budgetkonsolidierung in Österreich nach der Rezession

Abstract

The study develops a budget consolidation strategy for Austria that does not endanger the fragile recovery while at the same time promoting distrbutional justice. As a first step a literature review on the macroeconomic effects of discreationary fiscal policy is given. As a second step two country case studies are discussed. The failed attempts at budget consolidation in Germany during the stagnation period from 2001 to 2005 on the one hand and the successful consolidation period in the U.S. from 1993 to 2000. Against the background of the results conclusions for the future Austrian consolidation strategy are drawn: Instead of putting the recovery at risk by overambitious discreationary consolidation measures from 2011 onwards, consolidation alongside a more or less neutral expenditure growth path for discreationary giverment spending at about 3 to 3.5 per cent is recommended. Consolidation would primarily be achieved through automatic stabilisers. Compared with the currently envisaged tough restriction the solution proposed here would lead to a significantly better growth and labour market performance while at the same time not severly doing harm to the consolidation goal. If nevertheless there is a political preference for faster consolidation, this should be achieved via revenue-side measures as they usually are less harmful to growth and employment. This will be particularly the case if those taxes are increased that concentrate on high income/property households.