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Industrial Revolution and Corporate Expansion in 19th Century America

Explore the factors driving industrial growth post-Civil War, the rise of big businesses, the impacts of industrialization, and the emergence of new technologies and business practices in America in the 1800s.

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Industrial Revolution and Corporate Expansion in 19th Century America

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  1. Technology and Industrial Growth Chapter 9, Section 1

  2. Encouraging Growth • After the Civil War, industrial growth that had started during the war continued to flourish. This was due to a variety of factors: • Abundance of natural resources, including the discovery of oil by Edwin Drake. • Increased immigration from Europe and Asia • Forced out by political upheaval, religious discrimination and crop failures. • Capitalism encouraged the emergence of entrepreneurs. • Government aided this by passing protective tariffs and adopting laissez-faire policies. • Laissez faire= businesses operate w/minimal government regulation.

  3. New Technologies • New innovations: • Electric light bulb Thomas Edison • Telephone Alexander Graham Bell • Steel Henry Bessemer • Bessemer Process= purifying iron and turning it into strong, lightweight steel. • Expanding rail network demonstrated a need for the creation of time zones to regulate train schedules. • Natural resources + rail network= more growth! • Many goods were now manufactured by machines instead of by hand.

  4. Impacts of Industrialization • Industrialization had many impacts on the United States. • Increased population in cities immigration and need for unskilled labor; • Increased foreign trade as the U.S. expanded its markets; • Increased pollution and waste from factories caused people to start being concerned for their environment.

  5. The Rise of Big Business Chapter 9, Section 2

  6. Fighting for Profits • Businesses in the 19th century transitioned from family-owned to large corporations, where many people shared ownership. • The main goal of the corporation was to maximize profits and there were new ways in which corporations decreased costs to increase profits. • Horizontal integration= consolidation of many firms in the same business into one larger corporation. • Vertical integration= controlling different businesses that make up all phases of a product’s development.

  7. New forms of Companies • Some corporations wanted to increase profits by taking complete control of a product. This was known as a monopoly, or a trust. • Competitors were either bought out or pushed out of the market. • Once there was no competition, a business could charge whatever price it wanted for a product. • In other instances, corporations would work together to limit production in order to control prices. • This was known as a cartel. • O.P.E.C. is a cartel that still exists today.

  8. The Role of Big Business • Four main leaders emerged during the late 1800s to lead major corporations. • Cornelius Vanderbilt shipping • Andrew Carnegie steel • John D. Rockefeller oil • J.P. Morgan finance • These men were viewed in two different ways: • Robber barons pushing out smaller companies; high prices to consumers • Captains of industry adding more jobs to the labor force; provided financial backing for new technology; philanthropy

  9. Social Darwinism and Gov. Regulation • Application of Darwin’s theory of evolution to society. • Social Darwinism stated that those who were more ‘fit’ would survive over time, making the society stronger as a whole. • Discrimination also increased, separating the wealthy from the poor. • To some, this meant that the government should leave large businesses alone. • The government did impose regulations to limit corporate power • Interstate Commerce Commission= monitored the ever-growing railroad operations; first government body to do so. • Sherman Antitrust Act= outlawed trusts that restricted trade or commerce between states.

  10. Review Today’s Topics • Which of the following is NOT a reason immigration increased during the late 1800s? • Greater religious freedom in the U.S. • Political upheaval in their home countries • Greater crop production in home countries • Lesser political interference in the U.S. • The process of owning all areas of a product’s production is known as __________________________. • Horizontal integration c) cartel • Vertical integration d) monopoly • Which of the following is the correct match between an industrial leader and their industry? • Morgan; shipping c) Carnegie; steel • Vanderbilt; oil d) Rockefellar; steel

  11. Ticket out the Door Choose one of the industrial leaders. Is the term robber baron or captain of industry a better term to use when describing them? Provide at least 2 reasons why.

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