A Prototype Model of European Integration. The Case of Austria

Post-war European integration is a succession of regime changes: customs union in the 1960s, Single Market and EMU in the 1990s and EU enlargement in the 2000s. Since 1995 Austria as an EU member takes part in the deepening of EU integration (Single Market, EMU and Monetary Union) and participates in the enlargement process of the EU. Around the years 2014-15 Austria celebrates several anniversaries: 25 years of the fall of the Iron Curtain and hence expansion of new market opportunities through the opening-up of Eastern Europe, 20 years of EU and 15 years of EMU, 10 years since the start of the EU enlargement towards Eastern Europe. With the Croatian accession in 2013, the EU now counts 28 member countries. In order to capture the effects of the last 25 years of Austria's integration into Europe, an integration model for Austria is estimated. It is able to reproduce the main integration effects theoretically expected from the regime changes since 1989. In this respect, the Austrian integration model could also serve as a prototype for other EU countries. Overall, the participation in all integration steps since 1989 has added about 1 percent to Austria's real GDP per year.