The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
The paper describes key features of the Austrian financial system, analyzes current trends in Austrian banking, and discusses appropriate regulatory responses to the changing financial environment. The paper reviews the stylized facts and the main trends in the Austrian labor market, looks at the anatomy of unemployment to identify unemployment traps and labor market rigidities. The role of the institutional and policy framework in containing unemployment and its capacity to deliver results are also evaluated. Wage flexibility and policy challenges are also discussed.