The analysis of development of the Austrian capital market and its monetary consequences (in the period before 1918)

The dissertation thesis is considered with the development of capital markets in Austria before 1918. The Austrian capital market originated during the 18th century as the place for distribution of government securities. In 1771 the Vienna Stock Exchange was established as the first organized place for securities trading in the former Austrian Monarchy. The government securities remained the major investment instrument traded till 1918. In primary decades the Austrian capital market was nearly connected with the development of Austrian currency especially in times before the Austrian state bankruptcy in 1811 and then in times of the following effort of the Austrian government aiming the correction of Austrian currency. This aiming culminated in establishing of the Privileged Austrian National Bank as the first central bank in the former Austrian Monarchy. From about 1830 private securities were traded in the Vienna Stock Exchange as well. In primary decades these private securities were especially represented by equities and bonds of railway companies. The peak of private emissions related to the Austrian capital markets could be documented round 1870 in the framework of the so called founder times. These founder times were ended in Mai 1873 by the crisis on the Vienna Stock Exchange. After 1873 the Austrian capital market went back to the situation from the early 19th century, i.e. it can be seen the dominant role of government securities connected with the decrease of importance of the Austrian capital market as the place for company finance funding. After 1880 there is the origin of the very strong connection between the industrial companies on the one side and the banking sector on the other side which was typical not only for the former Austrian -- Hungarian Monarchy but also for German Empire and for other Middle European countries. The decrease of importance of the private securities was also caused by the nationalization of the Austrian railway companies after 1879. During the World War I the Vienna Stock Exchange as well as other stock exchange in the Monarchy was out of business. During this time the Austrian public debt was multiplied and the Austrian currency under strong inflation. After 1918 the Vienna Stock Exchange lost much from its former importance to the prejudice of the Prague Stock Exchange above all