L40 - Antitrust Issues and Policies: GeneralReturn

The topic of this study is historical analysis of the construction of the Czech railway network and the role of the state in its development in comparison with economic thought of the time. The aim of this study is to present relations between the development of theoretical economic foundations and the actual railway construction in the Czech lands from the middle of the 19^th to the beginning of the 20^th century. During this time, the railway network was constructed in the shape it functions until these days. The topic is examined as a historical sequence of interactions between actual railway construction and operation and economic opinions regarding the role of the state in construction and running of railways. The history of the relationship between the state and the railway went through a few periods differing in the approach of the state to ownership and operation. We can trace the private beginnings from the 1830s, to first state railways from 1841 to 1848, to privatization and indirect state subsidies, to the victorious definite idea of solely state railways in the last third of the 19^th century. The study follows detailed discussions of the era together with connections to economic thought of the era.

This paper describes the main theoretical concepts of the competition, which is thought to be the fundamental social process in the economy. The protection of competition (or the competition policy) is the one of the most important parts of economic policy, because the competition ensures the freedom of choice. The theory of competition provides large number of assumptions, which were developed within the frame of various economic schools and approaches. This paper starts with the description of the history of competition policy before the coming of Adam Smith. In the middle part of the work there have been formulated basic ideological theses about economic policy. Represented are, for example, the Classics, Ordo-liberalism or Neo-austrian School. Paper is finalized by the major theses of the Harvard and Chicago school.

It is generally established that the concept of monopoly refers to an existence of a single company operating on the relevant market. This interpretation, though commonly accepted and echoed by all textbooks, is incorrect. The fact of being a single supplier is not essential in forming the concept of monopoly. The essential feature of monopoly is not the fact of a single company as such but the fact of the government physical force (i.e. law) mandating the privilege of exclusivity and keeping potential competitors out of an industry. But the defect in traditional conception of monopoly had to wait - until economists invented the theory of perfect competition - before it could lead to the routine attacks against the very nature of business through the government anti-trust legislation. The concept of monopoly must be redefined and reconstructed and the vitally important distinction between economic power of business and political power of government must be recognized.