Austria 2025 – Consumption and Public Investments in Austria

Austrian domestic demand has been sluggish since the mid-1990s. In particular private consumption, which of all components contributes most to domestic demand, has increased only moderately. This pattern has become even more concise since the financial and economic crisis in 2008-09. This report discusses possible causes of this weakness in aggregate demand, whereby special emphasis is given to the developments in incomes and their distribution. Furthermore, the effects of a range of measures to strengthen domestic demand are calculated by means of model simulations. The report thereby focuses on measures to increase private consumption and public investment. The results of the simulations include distributional, macroeconomic and sectoral effects.