The economic performance of Austria and Italy during the last two decades is analyzed by economists from both countries. Their contributions interpret observed historical facts starting from a macroeconomic level down to disaggregated structural issues. The performance, as well as prospects of economic policy concerning the monetary sector, the balance of payments, the industrial sectors and the labour markets, are reviewed. Specific problem areas are investigated, and relationships to current economic theory are established. Readers should find sufficient material to form opinions about the difference in national approaches to assess economic problems, and about the different ways of attacking them.