Will Czech Trains Ever Travel to Efficient Destinations? Case Study of Firm under SBC
| Authors | |
|---|---|
| Year of publication | 2008 |
| Type | Article in Proceedings |
| Conference | Konkurenceschopnost a konkurence v železniční dopravě - ekonomické a regionální aspekty regulace konkurenčního prostředí |
| MU Faculty or unit | |
| Citation | |
| web | Text online |
| Field | Economy |
| Keywords | Czech railways; network industry; soft budget constraint |
| Description | The paper presents the application of the Soft Budget Constraint theory on the Czech railways. It attempts to show that the organizational structure of the Czech Railways is historically dependent on governmental subsidies. Evidence from financial analyses supports the hypothesis that even though public policy is trying to establish a competitive environment in the Czech Railways' organizational structure, the existing environment could not improve efficiency of the railways without cutting the governmental subsidies. The reason for such conclusion is that the incentive structure will not motivate the Czech Railways' organizations to improve the efficiency or, alternatively, it will not allow these historically inefficient organizational structures to disappear. |
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