Alexis Wearmouth, University of Dundee
The Origins and Growth of Foreign Direct Investment in the Calcutta Jute Industry by a Scottish Multinational Enterprise – a Case Study of Thomas Duff & Co, 1872-1896.
With its headquarters and initial capital in Dundee in Scotland, the Thomas Duff group of jute textile mill companies operating in Calcutta experienced rapid growth during its first two decades in spite of the Great Depression and the negative reputation for speculative exuberance of the existing Calcutta industry that deterred foreign investors. Thomas Duff represents an exceptional case of Dundee business venture; Dundee already had an established jute textile manufacturing industry and the formation of Thomas Duff coincided with the investment trust boom, which channelled most Dundonian surplus capital into ventures in the western United States. Thomas Duff represents an atypical form of business venture, one of the only instances of successful Scottish foreign direct investment in manufacturing enterprise in this time period.
This paper considers the minute books of meetings of the directors of Thomas Duff & Co together with other archival sources in order to analyse the content of economic relationships and competences within the joint stock company form adopted by the Duff companies, and the adaptation of the group structure to growth. This case study draws on the existing literature on the categorisation of British foreign investment in the age of empire and, in turn, illuminates the relative strengths of rival typologies – Wilkins’ 'free-standing companies', Jones’ 'multinational traders' and Chapman’s 'investment groups'. It also considers the applicability of theories from institutional economists such as Williamson to economic historians such as Chandler. There are significant aporia in this body of literature by western business historians and economists, which neglect to consider sufficiently the imperial context governing the functioning of the factor and product markets of an important Indian export industry.