Title page for ETD etd-07282012-193818

Document Type Master's Dissertation
Author Mwamba, Alain Donatien Tshiamala
Email ichelp@gibs.co.za
URN etd-07282012-193818
Document Title Transaction costs in the mining sector in South Africa
Degree MBA
Department Gordon Institute of Business Science
Advisor Name Title
Mr M Holland Supervisor
  • price discrimination and outsourcing
  • vertical integration
  • economics of organisation
  • transaction costs
Date 2012-03-08
Availability unrestricted
The present research identified transaction costs in the mining sector in South Africa and provided means for mitigation. A review, discussion and evaluation of theories related to transaction costs such as vertical integration, outsourcing, price, long and short terms contracts was undertaken under literature review.

A qualitative study, with two research questions, on eight companies of which four precious metals and minerals, two metallic minerals and two non-metallic minerals, was performed and provided among other results:

• Cost of doing business in South Africa is high.

• Site specificity and physical-asset specificity are the most influential specialised investments in the mining sector.

• Long term contracts are the most appropriate to mitigate transaction costs.

• Costly bargaining is the most important implication for all specialised investments.

• Exchange rates, Mining Charter, BEE, legislation, taxes, royalties, fuel and electricity increases are cited as reasons for high transaction costs.

• The small sample is a big concern as it does not allow generalising the results to over all mining companies.

The South Africa’s government, as a regulator and a major stakeholder should revisit the mining charter and therefore the B-BBEE act as this clearly appeared to be a barrier to the development of mining companies.

© 2011, University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria.

Please cite as follows:

Mwamba, ADT 2011, Transaction costs in the mining sector in South Africa, MBA dissertation, University of Pretoria, Pretoria, viewed yymmdd < http://upetd.up.ac.za/thesis/available/etd-07282012-193818/ >


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