Collective counterveilence as a deterrent to entry: A reconsideration of the factors limiting competition in post-Apartheid South Africa

This paper argues first, that competition in post-Apartheid South Africa has to be viewed in the context of its history. If that is the case, second, the proliferation of firms in post-Apartheid South Africa is only nominally entry. It is on the one hand the result of a longer-term trend to create holding companies that emerged post-war and as a shortcut to accelerate ownership as part of the indigenisation imperative of Apartheid. What has changed more recently is that rather than in some cases acquiring part ownership of fixed assets, on the whole these entities hold more liquid and speculative assets. It is on the other hand, the result of the unwinding and in the process de-scaling of the larger and more dominant firms’ fixed assets. This means that there is remarkable causal continuity in the evolution of firm behaviour and so competition, as a first approximation, roughly over the past century and a half. We coin and apply the term ‘collective counterveilence’ to explain this phenomenon.