Abstract
D.Com. (Economics)
The objective in writing this thesis was to investigate the capital structure
of South African manufacturing industry and the implications of this structure
for policy formation relating to industry.
The capital stock of the 27 branches of the manufacturing industry were
calculated by means of the perpetual inventory method based on the following
assumptions: capital formation excludes transactions relating to inventory,
durable consumer goods and financial assets; transactions in land and
other fixed assets were taken into consideration; leasing was regarded as
investment and capitalised at ten times the annual base payment in respect
of land and buildings and five times in respect of machinery and transport
equipment; and transfer costs on property and existing buildings were
treated as part of fixed investment.
Cencuses compiled by the Department of Statistics were the main source of
information in the calculation of investment. Depreciation was based on
the straight-line-method. Price indices from various sources, including
those compiled by the Reserve Bank, were used. The economic life of fixed
assets for the various branches of the manufacturing industry was chosen
after consultation with experts in the various industries and an analysis
of information obtained by questionnaire.
It was found that the real capital stock of manufacturing industry increased
by 1 247 per cent during the period 1945-1975, i.e. at an average annual
rate of 8,8 per cent. The basic iron and steel industry with a capital
stock (valued at 1975 replacement values) or R2 478,4 million in 1975 was
the largest absolute consumer of capital followed by the food industry ...