Title: Influence of the monopolistic production of mineral water on its value chain in the Czech Republic

Authors: Karel Šrédl; Vladimír Krajčík; Milan Robin Paták; Lucie Severová; Roman Svoboda

Addresses: Faculty of Economics and Management, Czech University of Life Sciences in Prague, Kamýcká 129, Prague 6 – Suchdol, 165 00, Czech Republic ' University College of Business in Prague, Spálená 76/14, Prague – NovéMěsto, 110 00, Czech Republic ' University College of Business in Prague, Spálená 76/14, Prague – NovéMěsto, 110 00, Czech Republic ' Faculty of Economics and Management, Czech University of Life Sciences in Prague, Kamýcká 129, Prague 6 – Suchdol, 165 00, Czech Republic ' Faculty of Economics and Management, Czech University of Life Sciences in Prague, Kamýcká 129, Prague 6 – Suchdol, 165 00, Czech Republic

Abstract: The research subject is the sale of mineral water, the production of which has the character of a monopoly due to the control of the resources necessary for the production of this product by one firm. The goal of this article is to express the amount of economic profit (within a monopoly) of companies that produce mineral water, achieved due to their privileged position on the given segment of the market; the expression of a value chain of mineral water production will be the means of achieving this objective. The research will also result in recommendations for the behaviour of producers and consumers in a given segment of the mineral water market. The survey shows that due to their monopolistic position on the mineral water market, up to CZK 34 of the firms' earnings per litre of mineral water has the character of pure economic profit; this represents, on average, a monopoly profit of 76.87% of the price of the product.

Keywords: bottled water; control of the resources; Czech Republic; economic profit; mineral spring; mineral water; monopoly; price; retail chain; value chain.

DOI: 10.1504/IJVCM.2020.109232

International Journal of Value Chain Management, 2020 Vol.11 No.3, pp.228 - 249

Received: 10 Aug 2019
Accepted: 15 Nov 2019
Published online: 02 Sep 2020 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article