ABSTRACT
The discovery of diamonds in 1867 and gold in 1886 constituted the beginning of a century of growth in South Africa, at a pace that was among the fastest in the world. This process was fueled by a combination of a high rate of capital formation and low wages for a majority of the population: the Africans. Racial discrimination in the labor market contributed to bringing an 'unlimited' supply of labor in the sense of Arthur Lewis into existence, i.e. unskilled African workers could be obtained at a more or less constant wage rate when the 'white' economy expanded. A powerful 'growth machine' had been created.
