Oligopolization of banking industry in Czech republic

Bachelor thesis is targeting towards problem with oligopoly and capital accumulation of banks. This thesis analyses contemporary issues in financial world, which results from capitalistic order and it mostly focuses on banking industry. Firstly we focus on history of oligopoly and monopoly that are closely related to Karl Marx and his thoughts. Then we subscribe terms of oligopoly and monopoly and reasons why do they arise. Primarily we examine concepts of economies of scale or entrance barriers, those are often related to market failures and inception of oligopoly. Furthermore we devote to oligopoly models, which show how to reach equilibrium. The fundamental goal for this thesis is to analyze Czech banking industry and to prove the fact that it works under oligopoly structures. In order to prove these oligopoly structures we have to demonstrate that Czech banks reach extraordinary profits. In oligopoly a bigger bank should reach greater relative profit, which we deeply analyze. For measuring and proving oligopoly power we use procedures that are usually being used by European Central Bank. Most importantly it is the share of five largest banking institutions or Herfindahl-Hirschman index. These figures we also compare with foreign countries and try to find reliance of oligopoly power on the size of the country. In that order we choose countries that are more likely to form stronger oligopoly structures. The main objective of this thesis is to prove than banks are achieving extraordinary profits in Czech banking industry and emphasize the fact that banks holds the upper hand over clients