INTERNATIONAL BUSINESS HISTORY

The Mount Lyell Mining and Railway Company

Abstract

The purpose of the assignment is to assess the nature of free standing company business with the help the help of the real time example of The Mount Lyell Mining and Railway Company. The paper presents a brief overview of the company followed by details of its founding people and background of the company.



The Mount Lyell Mining and Railway Company

Introduction

The paper discusses the Mount Lyell mining and railway company in terms of the views of Mira Wilkins of the free standing company. The mining company is what Mira called free standing firms because most of them did their business overseas. Some of these companies were usually small who manage a single deposit. To achieve economies of scale, the free standing companies resorted to the subcontracts like the Mount Lyell.

Views of Mira Wilkins and the Company

The views of Mira Wilkins about the free standing company are related to the mining and Railway Company in a sense that the identification of the free-standing company in associated with the understanding of the institutional business structures associated with international capital movements. The importance of the notion rested on its insistence that the essential features of international business firms as they evolve through time, including how they are managed. Wilkin says that the investors in a firm and the firm it may be one and the same, or there may be a separation of ownership and control of a firm, as in the modern managerial corporation. Wilkin says that in order to understand the history of international business, one should believe that the attention must be on the firm as the actor rather than on a more generalized approach. In some cases, holders of shares (owner ship) of a firm were widows and orphans, or institutional investors on their behalf; in other cases, shareholders were active participants; frequently, there was a mix of passive and active investors. An important feature of MNEs and FSCs is the ownership advantage which is a concept that is derived from analyzing the foreign direct investment. The ownership advantage explains the subject of investment that is the investor. On the other hand, the vocational advantage determines the object of investment. Wilkins's states that “a firm needs to have an advantage over the actual or potential local competitors to survive abroad”.

Concept of Free Standing Company in Relation with Mount Lyell

Mira Wilkins has suggested that the Free Standing Company (FSC) was an important means by which capitalists seeking to operate businesses in countries that were not their own operated. This organizational form is different from that of the traditional multinational firm in that it was not based around an already existing firm; there was no export of Chandelerian competitive advantage in this scenario. Instead of establishing a successful business model in the home country and then seeking to export it by adoption and adaptation Free Standing Companies registered themselves under joint stock legislation in one country and carried out their operations mostly ...