The use of capital markets in the Czech Republic has been increasing over time, but it still remains insufficient. The state has a number of tools and options to enhance their utilization, including the concept of so-called libertarian paternalism. The principles of libertarian paternalism can be applied not only in the area of retirement planning, but the state can also “nudge” the segment of the population it employs.

Key takeaways:

• Capital markets are a fundamental element of economic growth – they enable businesses to finance innovation and expansion, while offering investors opportunities for diversification and capital appreciation.
• In the Czech Republic, capital markets are not being fully utilized – investors often prefer more stable and developed foreign markets, particularly in the United States.
• Enhancing the attractiveness of capital markets requires targeted measures – these include support for long-term investment products (e.g., pension savings or children’s investment accounts), tax incentives, the development of employee stock ownership plans (ESOPs), and a stable, predictable regulatory environment.

Policy Brief –Martin Zeman

The analysis is in PDF under the link below.