Anthony Lumby

Economic history and theories of the multinational corporation

Abstract During the past one hundred years, the growth of foreign direct investment (FDI) and the multinational corporation (MNC) have emerged as two of the foremost characteristics of global economic development. They have been spawned by, and have given shape to, the remarkable growth of the international economy during the past century. While it is recognised that FDI and the MNC are not necessarily one and the same thing, 1 historically FDI has been closely bound up with the development of international business and may be regarded as the backbone of multinational enterprise. Indeed, the available statistics indicate that a decisive share of the global stock of FDI is owned and controlled by MNCs which provide a wide range of products and services: Alcan aluminium, Bayer drugs, General Motors and Ford cars, IBM computers, Philips electrical products, Shell and Esso petroleum products, SKF bearings and Unilever detergents, to name but a few obvious examples. 2

Environmental economics and the shaping of development strategies

All human societies have been shaped by their interaction with the environment, from the nomadism of hunters to settled agriculturalists and our own urbanised cultures. Similarly, all human societies have engaged in some depredation of the environment, such as the increased salinity of irrigated Mesopotamian soil and the deforestation of 16th and 17th century Europe; but the scale of environmental degradation during the last hundred years has been unprecedented.

Foreign trade and economic growth : South Africa during the inter-war years

Abstract The role of foreign trade in economic growth has been the subject of considerable debate amongst economists and economic historians.1 The classical school which dominated British economic thinking for most of the nineteenth century accounted for foreign trade by the principle of comparative advantage. If one country was more efficient than another in producing both of two products, it still paid for each country to specialise in the production of that product in which it enjoyed the greater relative advantage and then engage in international trade.2 Despite the seductive appeal of the classical view, the question which it ignored is whether comparative advantage explains how foreign trade is related to economic growth. After all, economists have yet to reach agreement as to how to measure the gains from foreign trade; and even if it is assumed that such gains can be measured, J.D. Gould has insisted that they would account for no more than “…a modest fraction of the economic growth achieved over ...

Industrial History in South Africa: Past Trends and Future Needs

Abstract At the outset, it is necessary to clarify an apparent paradox: industrial history is not a new field of study and yet it is a modern one. It is not new because its origins date back more than two hundred years to the eighteenth century, when England became the first country to begin to transform itself from a predominantly rural, agrarian economy and society to an overwhelmingly urban, industrial one. This long process of industrialisation — which produced some of the first industrial histories in print1 — can hardly be regarded as new. Nevertheless, industrial history must be regarded as modern. After all, it has been the transforming effects of industrialisation which produced the modern era. Indeed, the extent of industrialisation is often used as a gauge of the degree of modernity in an economy.

A Comment on the Real Forces in South Africa's Industrial Growth Prior to 1939

Abstract At present there exists a broad consensus as to the pattern of South Africas industrial development since the Second World War. It is generally agreed that the four post-war decades witnessed the structural changes which transformed South Africa into an industrial economy. Between 1945 and 1982, the net value of secondary industrys output rose in money terms from R276 million to almost R22 billion. 1 In 1965, for the first time, the share of manufacturing in the Gross Domestic Product exceeded the combined contribution of the agricultural and mining sectors. 2 Furthermore, those decades marked a significant broadening of the industrial base away from the pre-war concentration on the processing of primary products and the production of consumer goods towards the manufacture of a wide range of intermediate and capital goods.3

Approaches to economic valuation in environmental impact assessment: a review

Environmental Impact Assessment (EIA) constitutes a form of systematic decision–making with a view to identifying the best project amongst a series of alternatives. Within the EIA process, the economic component is that of cost–benefit analysis (CBA), in which all costs and benefits, including environmental costs and benefits, are identified and valued. For economists, one of the major challenges facing the effective conduct of CBA is the ability to capture total economic value because of the difficulty in assessing the value of all environmental impacts, particularly where such impacts are not reflected in market prices. In order to remedy this example of market failure, a wide range of economic valuation techniques has been developed in order to allow us to assign a value to all environmental costs and benefits, especially those for which no markets exist. Against this background, the purpose of this paper is essentially threefold: (a) a brief review of the key issues in EIA with particular reference to CBA; (2) a discussion of the notion of total economic value and the need for economic valuation in CBA; and (3) a brief review of the more important valuation techniques available to us.

Distance Learning: The Experience of Accounting at the University of Natal (Durban), South Africa

The South African university system consists of 21 universities. These universities serve approximately 400 000 students spanning a wide spectrum of qualifications and educational platforms. However, under the banner of apartheid, South Africa’s past policy of racial segregation led to universities establishing themselves along race-determined lines during the second-half of the 20th Century. Additionally, arbitrary government regulation produced further artificial divides within the education system. By way of example, prior to 1994 South Africa’s tertiary education sector was divided into two distinct parts. These were residential universities, which adopted direct teaching methods and accounted for the bulk of student enrolments, and “open” universities that adopted distance learning as their educational platform. Within this sharply divided educational context, the University of South Africa (UNISA) and Technikon RSA dominated distance-learning programs. The two institutions collectively accounted for the bulk of tertiary education enrolments by distance learners and were responsible for just under 30% of all higher education enrolments in the first-half of the 1990s. The country’s historically White universities, on the other hand, dominated residence-based teaching, accounting for almost two-thirds of student enrolments.

A comment on the management of South Africa's commercial fishing industry

Oceanographic conditions along the South African coastline provide a favourable habitat for a rich variety of renewable marine resources that provide the base for the fertile and diverse fishing grounds located along the countrys west and east coasts. These fishing grounds, in turn, provide the backbone for the countrys fishing industry, which enjoyed particularly rapid growth over the period 1940-70.

Environmental economics and cost–benefit analysis: the choice of an appropriate discount rate

Notwithstanding earlier approbation from economists on the use of the discounting technique, the past twenty or thirty years have witnessed a growing acceptance of the use of this technique in cost–benefit analysis. Nevertheless, there is no general agreement on the type of discount rate to be employed, nor whether it would be more appropriate to employ a (lower) social discount rate, especially in the case of long–term projects or those which are assessed to have significant environmental impacts. Furthermore, in recent years, the earlier debate against the use of the discounting technique has re–emerged in somewhat different form. Against this background, this paper seeks to explain the different types of market discount rates available - namely, the consumption rate of interest, the investment rate of interest and the accounting rate of interest - and explores the argument for employing a (lower) social discount rate. Thereafter, attention is focused on the more recent debate against the use of the discounting technique in general. Finally, an attempt is made to assess alternative approaches to the conventional discounting technique: a zero discount rate, the internal rate of return and the use of so–called quasi–discount rates. The latter is found to offer a more pragmatic approach to the use of the discounting technique, and is considered more appropriate for cost–benefit analysis involving projects which have significant environmental impacts.

Phases I, II & III of the local content programme in the South African motor car manufacturing industry 1961-1976

Historically, the growth and development of the motor car industry in South Africa has been shaped by both spontaneous forces and deliberate policy. Within 12 years of the development of Carl Benzs tri-car in 1885, and even before the motor industry was firmly established in Britain and the United States, the first motor car was imported into the South African Republic in January 1897. Further imports followed after the end of the Anglo-Boer War, but the difficulties of early motoring essentially those of poor roads and farmgates combined with public resistance to make the motor cars role in the sub-continent a hesitant one. Thus during the early years of the twentieth century, South Africas motor car imports inched forward at a time when world motor car production rose dramatically from a mere 8 400 units in 1900 to 245 000 units in 1910, of which almost three-quarters was produced by the United States.