Efforts to Improve Competitiveness

Like many other countries that had concentrated on industrial production and where industrial value added constituted an important element of national production as well as of national exports, Austria had to reevaluate its performance during the 1980s. The government commissioned a special report on the need for structural adjustment, and a number of steps were taken to make Austria more competitive worldwide.

Steps to increase competitiveness include privatization, greater incentives for research, and greater readiness to make decisions about curtailing subsidies where they are not warranted (especially for nationalized industries) and could drain resources from other potentially more competitive industries. Although industrial subsidies are harder to calculate than agricultural subsidies because of their greater range (from direct payments to accelerated depreciation allowances and the like), the government during the 1980s made special efforts to reduce those subsidies and encourage competitiveness. Some of these measures appear to have been at least in part effective, although they were not always carried out as fast as originally planned.