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During the transition of the central planned economies to the market system unemployment has become one of the most serious problems. The article describes the current state of unemployment in the Czech Republic and Slovakia. Using models of marginal effective tax rates developed by the OECD we discuss the influence of wage taxation, social security contributions and the benefit system on taxpayers' incomes and therefore on the motivation to work. The first part describes alternative indicators for measuring taxation of labor, analyses the methodology of measuring marginal effective tax rates and shows the calculated results. The next part discuses the influence of these effective tax rates and benefit systems on the taxpayers' net incomes and analyses possibilities of poverty traps for households, especially for low-wage taxpayers. The results show that efforts to reduce poverty hardly reduced work incentives in the Czech Republic and Slovakia.

Gradual narrowing of the gap between consumer and investment demand was one of major achievements of 2003, supporting the long-term sustainability of Czech economic growth. In the first half of 2004, industry and construction witnessed strong growth, retail trade showing a considerable slowdown. Growth in industry has continued to be more rapid in the sector of foreign controlled companies. After a slight weakening of deflation tendencies in the third quarter of 2003, last quarter of 2003 and first half of 2004 confirmed a resurgence of inflation. Growth of industrial prices was more rapid than the growth of consumer ones, predominantly due to increasing world prices of oil and metals. The labour market and public finance continue to be the main macroeconomic problems of the Czech Republic. The improvement may come only after adoption of fundamental reforms in both these areas.

The author undertakes in his essay a risky experiment as he tries to look at the present-time-economic-transformations in the view of the great thinker of 18th century, Dr. Bernard Mandeville, who famed by his Fable of the Bees, or Private Vices and Public Benefits. The philosophy of Mandeville, as is well known, influenced besides others, F. A. Hayek and J. M. Keynes, the former by ascribing Mandeville the primacy of the idea of spontaneity in evolution and the latter by assesing luxury in promoting the spending. In the course of economic reforms the truthfullnes of the so-called Mandevill paradox has been widely afirmed; knaves were becoming virtuous and property conferred respect and authority upon the "nouveau riche".

The Council of Economic Experts and its influence on the German economic policy are discussed in this paper. The first section concentrates on the institutional background and historical genesis of this body. Consequently, the importance of the Council in preventing a competitive and efficient economic order in the ordoliberal point of view is considered. The second section offers a comparative analysis of economic policy consultancy. Some significant institutional aspects of the German Council of Economic Experts, the US Council of Economic Advisers and the French Conseil d'Analyse Économique are examined.

The concept of utility is interpreted (in M. Friedman's intentions) as the present value of future income from investments in human capital occurring in the framework of personal consumption. In this sense consumption is regarded as a productive phenomenon. On this basis the concept of general economic equilibrium can be classified. On the one hand, instead of the disputable theory of social welfare the role of capital market in parallel creating equilibrium between supply and demand of investments opportunities, on the other hand, demand and supply of investment funds is applied. The proposed concept is applicable to explain current changes connected with the transition to knowledge based society.

This article is oriented on the analyses of the development of the mergers and acquisition process. The author shows the main reason and motivations of expansion MA and its influence on the globalization of the world economy. This activity is (in the time and the territory) very different and heterogeneous. The leading players of his process are the multinational corporations, however, the value of deals of SME's is going up, too. In the last years these activities concern to the change of strategy of MNC's, first of all to the supporting of cooperation among them. The latest period is under the increasing pressure of the development of the international production sharing and production cooperation. The final result of this process is creating to a new sharing of the economic power in the worldvide framework, as a whole and influencing all regions, the emerging markets not shows off.

The paper deals with the thematic structure of journal articles according to the Journal of Economic Literature (JEL) classification system. For this purpose, three representative periodicals from 1999 to 2002 are analysed by examining the publications by Czech and European economists. The research methodology is as follows. First, the institutional affiliation of the journals' contributors is identified by examining the information provided by the authors in their articles. Second, the JEL classification stated in the journals is investigated with respect to co-authorship issues and the relative significance of the multiple JEL codes. The results indicate that when compared to the rest of Europe, Czech economists prefer macroeconomic problems to the microeconomic ones and have a strong bias for the methodology and history of economic thought, as well as for the mathematical and quantitative methods. On the other hand, Czech researchers exhibit a markedly lower interest in labour and demographic economics.

Economic analysis of law concerns predicting impacts of legislative rules on incentives and behaviour of individuals and judging social efficiency of alternative legislative rules. It applies price theory, welfare theory and public choice theory on creating and applying law. One of its main shortcomings however is the lack of criteria of social efficiency. Modern history of economic analysis of law begins within the framework of property rights and transaction costs theories. The Chicago school has been the most prominent group of economists. Austrian school and New institutional school compete with Chicago school in applying different methods of economic analysis on law. Chicago approach is based on assumptions of rational economic behaviour and stable preferences. In the centre of Chicago paradigm lies Richard Posner's efficiency thesis predicting that law rules develop in efficient ways. Austrian school criticizes Chicago school positivism from the perspectives of methodological subjectivism.

This paper reviews important approaches to discounting in economic modelling. It summarizes historical approaches and discusses why exponential discounting has been adopted as a widely accepted benchmark. The article then presents hyperbolic discounting as an alternative, while stresses different interpretation of discounting in positive and normative economics. In positive economics, the paper uses recent evidence to show that some observed regularities implied by exponential discounting are counterfactual and we illustrate different implications of the two approaches to discounting using numerical simulations of a stylized model of investment-consump- tion behaviour. It also concerns with applications of discounting in normative models of environmental economics. Many authors claim that exponential discounting, when used for long-term project evaluation, leads to an unfair treatment with generations living in a far future. We construct a model of optimal non-renewable resource exploitation to illustrate different normative implications of exponential and hyperbolic discounting.

The topic of this paper is concerned in a possibility of connection of the micro- economics theory and the business economics theory. The goal of the submitted paper is an implementation of an economic efficiency as a microeconomic component to the business economics with a regard for an economic practice of companies in the Czech Republic. I use an analogy of the microeconomics and the business economics concept of total revenues and total costs to this implementation. The main of the text is reserved to opportunity costs because it is fitting to total economic costs from a point of view of business economics theory and practice is complicated. On basis of accepted analogies I generalize conclusions about an economic efficiency and I think of a product possi- bility frontier in a company too.

This article describes core changes, both theoretical and practical, of DC's action unity and its new features after the globalization acceleration during the 90's and the beginning of 21st century. Following re-defintion of basic terminological issues the authors show that the "unity of purpose" famous in the 70's has not yet evaporated as predicted by some authors in the late 80's. The case is analyzed and ilustrated by the failure of 5's WTO Summit in Cancún, September 2003 and also negotiations connected with the creation and activities of Group 21. The problems of agricultural subsidies are in the centre of attention with possible impact on international trade as mainly EU and its new members (including the Czech Republic) is concerned. However, the authors predict that the new LC's "unity of purpose" will be more volatile and fragile than before.

The paper presents in contribution the development of theories and opinions about competition, competitiveness and antimonopoly policy. These topics are treated starting from the oldest time, e.g. from Aristotle, through antique world, early capitalism, A. Smith and the classical Ricardian tradition. She further discusses the ruinous competition and the origin of the first framework of anti-trust legislation at the break of 19th and 20th centuries, Marx's interpretation of concentration tendencies of capitalist development and his followers, the origin of imperfect competition, ordoliberalism and the system of neoliberal politics and at last the dynamic theory of competition - concept of workable competition as well as theory of "balancing force" and the concept of so-called mature corporations.

The economies of Central and Eastern Europe are acceding to the EU with economic levels well behind those of current Member States. Combining countries with different economic standards does give rise to certain risks. Where the convergence of the price level is too fast and is not underpinned by labour productivity growth above the level of growth in EU and by the related balancing of wage income, it could pose a threat to the standard of living due to the decline in real wages. If wage pressures are too strong, and force a rise in wages that is incommensurate to labour productivity, the competitiveness of the business sphere would decline, economic growth would slow down, and unemployment would ultimately rise. A key requirement for the smooth progression of integration is a robust economic growth on the basis of labour productivity and its harmonization with wage level and price level developments.

Slowdown of economic growth occurred as a consequence of overall European slowdown in 2002. The most reliable factor of Czech GDP growth has become private demand of households. The acceleration of Czech economic growth will be strongly determined by the timing and intensity of economic recovery in Western Europe which has been postponing ever since. Strong disinflation processes pressed the inflation rate to record low levels in the history of transition. At the same time, strengthening of CZK continued in the first half of the year with an upturn in mid-2002. Later on, Czech monetary policy succeeded to stop the appreciation, CZK returning back to the level from the beginning of the year.

The command economy that the Czech Republic inherited from the communist system was considered unreformable. It seems as if the social and economic transition of ex-communist countries is necessary for their full inclusion among democratic countries with highly developed market economic systems. No new central European tiger has emerged since Erhard"s reform in the post-war West Germany, since welfare-statism also destroyed a genuine economic transition in the Czech Republic. Influential interest groups were able to interrupt the transition process and to stop it halfway in many areas. Political pressures to bring the Czech Republic closer to European Union's standards led to the passing of laws and government measures that were incompatible with the highly-regarded transition strategy. The development of public law at the expense of private law enforcement (in accordance with EU policy) led to the further expansion of bazaar capitalism in the Czech Republic.

World economy slowed down more than 2 %, which was the main feature of its development in 2001. There were more factors behind this economic slowdown, primarily the faltering upswing of the world crude oil price, problems of the technological sector, and September 11 events in the USA. Recession forces hit world trade and investment activities in particular. Main sources of economic growth were thus significantly weakened in consequence. The growth rate of GDP in the EU slowed down from 3.3 % in 2000 to 1.6 % in 2001. A larger fall of the economy was prevented by only a slight deceleration of the growth of household consumption from 2.7 % in 2000 to 2.0 % in 2001 and keeping the dynamic growth of services between 2 % and 4 %. However, external trade growth rates were only a third on 2000 and came to limit Czech external trade dynamics in the second half of the year.

Freiburg school of ordoliberalism contributions to the modern economic thinking and some of its implications for post-war economic and social policy in West Germany are discussed in this paper. After explaining some elementary terms there is a short excursion in the economic history and external conditions. Part four discusses the importance of competition for both a dynamic and stabile economic growth performance and long-lasting balance in society, followed by a description of the basic premises of the competitive order - the constitutive principles and the regulatory principles preserving the competition and balance in long-run period. The role of state, science and the churches in creating and influencing both the order of economy and society is the theme of part five. Social market economy arising from the ordoliberal theoretical conception is discussed in part six.

The paper focuses on the oil price-macroeconomy relationship by means of analyzing the impact of oil price changes on economic growth in the United States of America from 1947: Q1 to 2001: Q4. First, we present the most important oil shocks that occurred in the second half of the last century. Then we describe three different proxies of oil price changes. Second, we provide large analyze of the impact of oil price increases and decreases on the GDP using the different types of measurements of oil shock. The results suggest that an oil price increase, which overcomes it's own maximum values from three previous years, has greater negative effect on production growth than if it simply corrects the previous decreases or exceeds a one year maximum only. The paper also presents a hypothesis that oil price decreases do not contribute to economic growth. All these results allow us to maintain the nonlinear interpretation of the analyzed relationship suggested by Hamilton.

This paper deals with regional integration in general and examines the intra-regional trade of selected regional groups and trade blocks as a comparative analysis. We pay particular attention to the periods after the founding of regional integration ( NAFTA and MERCOSUR) and after the signing of the AFTA (regards ASEAN) as well as the crucial years prior to and following the Asian crisis and since 1990 to 2003 for EU as a result of processes of trade liberalization in the mentioned regional groups. Using the statistical analysis, we found that the ratio of intra-EU trade has decreased from 66 per cent in 1993 to 60 per cent in 2003. In terms of the ratio of intra-NAFTA trade, this has signed increasingly trend during the period 1994-2003 and reached about 7 per cent growth. Similar trend has signed the ratio of intra-ASEAN trade, which increased more speed than the whole ASEAN trade, particularly after the signing of AFTA. Different trend was noticed on intra-MERCOSUR trade, which registered an increase up to 1998 and then it was sharply reversed.

This article focuses on applied general equilibrium models and explores main features of these models. Examples of successful applications of these models are demonstrated and appropriateness of the applied computable general equilibrium models in policy evaluation is assessed. Conditions of existence and uniqueness of an equilibrium are considered and techniques for finding such an equilibrium are discussed. The task of calibration of parameters for these models is dealt with. Dynamic forms of applied equilibrium models are shown to be useful tools for policy evaluation.

This article describes gradual but visible slowdown in development assistance provided by advanced countries for developing and transitional economies during the 1980s and 1990s. The anticipated peace dividend has not been replaced by the increase of ODA and the other forms of aid after the cold war's end. Some probable reasons are discussed in the second part, but found questionable, at least partially. These are regional crises since 1994, transformation costs in some former socialist countries and the low efficiency of aid due to widespread corruption, bad distribution etc. The transitional economies generally did not properly use some comparative advantages in the DC which they had in the early 1990s. Such shortcomings should now be rectified and aid raised as some of them will soon become obliged to join DAC and EU agreements after accession. Appropriate institutional network must be created by them.

Proposed article is focused on new economy and its significance in global processes. Comming from theoretic opinions of economic prominents authors emphasize its impact on makro- and mikroeconomics while focusing on its effect on economic growth. In comparison with old economy, article mentions the role of technology, scientific and technological development, growth of productivity, competitivness and innovation and following necessary deep change in structure of world economy. It concerns to new phenomena which significantly effect development of international business, especially transition from competition between makro- and microeconomics to improving cooperation and creating better conditions which enable better economic results on international markets. There is a result of these changes - a process of diferentiation among companies and national economies of the whole world economy as well.

The aim of the article is the evaluation of the role of political-economic factors in transition of the countries of Central and Eastern Europe on the background of their economic performance. The evaluation makes use of various methodological approaches differentiating between the extent (speed) of structural reforms and the quality of institutional framework. The surveyed factors include political and economic freedom, initial conditions, process of liberalization, and quality of governance. Despite some caveats of such analyses which limit the explanatory value of the observed relationships, the political-economic factors can be considered an important ingredient explaining diverging economic performance of transition countries, particularly in the case when the performance differences are rather large.

The aim of this article is to analyze trends of business cycle in the past decades. The main issues are following. Reasons of declining in economic activities. Special features of the postwar cycles. Causes of long-run changes in business cycle. Countercyclical policies. Impacts elements of new economy on the stages of business cycle. Methodological approaches to the monitoriong of business cycle at the level of the OECD and the EU countries.

This paper is an attempt to grasp and model the problem of optimal strategy of a firm under conditions of unremitting increase of returns to scale and multiple threats of firm's downfall. The firm in our model has to pay high fixed costs to enter the market and its marginal costs are insignificant (zero). The firm is threatened by two threats at one time: by too low profit and by an entrance of a new firm to the market. We have shown that this problem has (either for uniform or for normal distribution of probability of survival) only one solution. This enables us to construct the supply function. In case of absence of the new entry threat, this supply function is in fact the supply function in the standard neoclassical microeconomics.

This paper investigates the nature of the Czech intra-industry trade (IIT) and its labor market determinants. In the analysis of IIT its decomposition into vertical and horizontal components is used. The Czech Grubel-Lloyd Index of 75 % at the SITC 2 digit level is still somehow lower than the values for comparable EU countries, but this difference is not high. This indicates relatively high level of the Czech integration into the European and world economies. Also the structure of the Czech IIT with respect to its horizontal and vertical elements is comparable with the structure of IIT in EU countries. The results of cross-industry analysis of labor market determinants of IIT show that labor market characteristics are statistically significant predictors for IIT after controlling for structure of IIT, character of industry and time changes.

Paper presents group of indicators highlighting qualitative (structural and technology) characteristics of transition economies, EU-candidates, within the framework of their economic performance. More detailed overview is presented for group of OECD-member transition countries for evaluation of their capacity of knowledge creation and diffusion. The comparisons were made to EU levels, more specifically to their maximum and minimum values. The indicators point to efficiency differences in factor utilization (labour force and particularly research and development inputs). Comparisons with Hungary highlight mostly unfavorable trends in the Czech Republic which may be reversed by foreign investment inflows in recent years. Due to lower level of research and development in higher education and lower share of workers with tertiary education attainment, insufficient development of absorption capacity may freeze the economy in the trap of equilibrium with low skills and low productivity.

The article attempts to provide a definition of a still not well-defined concept of the new economy. It deals with characteristic features of the new economy and its socioeconomic implications. Empirical evidence on the existence of the new economy is presented. Importance of information and communication technologies (namely internet and e-commerce) for the new economy is stressed and documented. Some myths about the new economy are clarified, and implications of the new economy for economic policies and statistics are described.

Economic growth continued despite overall slowdown of world economy in 2001, due to strong domestic demand. Inflationary pressures remained under control as well as external imbalance. Czech exporters proved to be able to compete on demanding world markets even under weak demand and strong exchange rate of CZK. Strong inflow of FDI and solid macroeconomic fundamentals have been the main factors behind the strengthening of the Czech currency which seems to be resistant to monetary policy steps. Trends in the Czech economy in 2002 will be strongly determined by the timing and intensity of economic recovery in the US and Western Europe. Anyway, both parts of domestic demand - investment demand and private demand of households - are expected to continue in solid growth in 2002.

After Czech voucher privatization many companies simply ignored the interests of their shareholders. The government has since increased the amount of regulation, but they have failed to establish significant investor confidence. This article offers some explanations of why their legal centric approach remains unlikely to create good corporate governance. Mandating that companies maximize shareholder value is easier said than done because it requires government to assess whether companies are making optimal business decisions. In former communist countries especially, government officials are ill suited to make such judgments because they lack the knowledge of how businesses should be properly run. Increased bureaucratic oversight in the Czech Republic has simply burdened markets without any noticeable positive results. This article discusses how good corporate governance can only be a byproduct of markets where managers compete for investors rather than something that can be created by law.