THE GILDED
AGE:
ECONOMICS
TRANSFORMATIONS BROUGHT ABOUT BY
INDUSTRIALIZATION, URBANIZATION, AND INNOVATION
LEAD TO A CHANGE IN THE STANDARD OF LIVING OF
THE NATION.
BELL RINGER: ANALYZE THE CARTOON
IN 2 SENTENCES.
MODERN
‘ROBBER BARONS’??
Who is this
referring too?
And why ?
Write this down
in your notes
Share with your
partner
INDUSTRIALIZATION: MAIN IDEAS
Industries and “Big Business” grew in response to
technological innovations
• Bessemer Steel process which enabled faster production
of a strong steel product
Other breakthroughs in electricity, mass communication,
and shipping allowed factories to produce more, at a
faster rate
Large numbers of immigrants provided industrialists with
more workers
• 1870s-80s immigrants coming from England, Ireland, and
northern Europe
• Later immigrants from Southern and Eastern
Europe/Mexico/Asia (until Chinese Exclusion Act of 1882)
JAY GOULD
Some big-name RR
magnates were called
Robber Barons for their
practice of swindling
investors & bribing
government officials.
Jay Gould
• manipulated stock values
by practicing“insider
trading.”
• He used information he
received as a railroad
owner to manipulate
stock prices to his
benefit.
Credit Mobilier Scandal - RR
construction
company - greatly
inflated construction costs &
pocketed ridiculous profits! Cheated
the stockholders of the
RR company. BUT…
Not all RR entrepreneurs were
“Robber Barons”!
James J. Hill
Ex: James J. Hill - took no
Great Northern
federal land grants, etc. He was honest Railroad
and smart in the the way he ran his
company.
Time zones were created to make RR travel
safer and more reliable.
BIG BUSINESS
Industrialists and business leaders used
horizontal and vertical alignment to reduce
competition and expand their companies
Reduction of competition led to the creation of
monopolies and trusts
Socioeconomic divisions widened as industries
grew
How did this create a
division in the population
?
List 3 reasons in your
notes
Share with your partner
BUSINESS
PRACTICES
•
•
•
Economies of scale - businesses
produce goods cheaply because
they make & sell so many of each
item.
• Big corporations could
squeeze out smaller
businesses and force them to
close.
• Many corporations began to
consolidate (merge their
businesses w/ others like them).
Pools - agreements among
companies to maintain prices at a
certain level.
Trust - Allows one person to
manage another person’s
property. Tactic to avoid state
laws which had been passed to
stop horizontal integration and
monopolies.
NEW TYPE OF BUSINESS ENTITIES
Trust:
 Horizontal Integration  John D.
Rockefeller
Vertical Integration:
o Gustavus Swift  Meat-packing
o Andrew Carnegie  U. S. Steel
4. Government helped, not hindered, business.
* Morrill Tariff - tariff on foreign imports;
made American goods cheaper, more
attractive to buyers.
* Land grants to railroad companies &
businesses; this
further spurred
settlement of
the west and
boosted the
economy.
FREE ENTERPRISE
As industry grew rapidly, the US
government promoted free enterprise
• Free enterprise – business that can
operate competitively for profit with little
government involvement/regulation)
GNP
• Gross National Product
• All of the goods and services produced
within a country in one year
Abundant raw materials were the key to
success
Laissez-faire (French for “let people do as
they choose”)
• Freedom of economic conduct
• Government should not interfere in the
economy other than to protect rights
• Limiting government control reduces the
possibility of regulation and corruption
• Allows the market to govern itself,
based on supply and demand
Department stores became popular:
• Woolworth’s
• Mail order/catalog stores:
Montgomery Ward
Sears & Roebuck
MODERN
‘ROBBER BARONS’??
Who is this
referring too?
And why ?
Write this down
in your notes
Share with your
partner
ACTIVITY
Analysis
the
economic
issues
during the
gilded age
.
With your partner create a title for
your group of words
Create a graphic organizer or
visual representation of your topic
.
Answer the questions on the
bottom of you paper
• What impact does your issue have
on the economy of the Gilded Age?
• What kind of government policies
are or should be enacted on your
issues to protect consumers and
the labor force.
Post you paper on the back wall
for a gallery walk before you leave