Technology, Industrial
Growth, and Big
Business
American History
Goals


Students will be able to:

Examine causes and consequences of the second Industrial Revolution

Compare the first and second Industrial Revolutions in the U.S.

Determine how new industry, technology, and business changed the economy

Identify significant inventors of the Industrial Revolution

Analyze changes as the U.S. became an industrial society
Terms to Know:

Entrepreneur, protective tariff, laissez faire, patent, Thomas Edison, Bessemer
process, suspension bridge, time zone, mass production
Industrial

Natural Resources helped the country launch itself head long into the
industrial revolution


Coal, lumber, rivers, and oil were all abundant resources found in the America’s
The United States also had the benefit of a labor increase

This increase took place due to political, religious and crop issues in Europe

These European immigrants poured into the U.S. and provided workers for the
growing number of factories in the North
Capitalism


Capitalism is an economic system based on the free market

Businesses will sell what people want or they will fail

Businesses operated under a laissez-faire system, one in which businesses could
operate with minimal government regulation
Entrepreneurs, or people who invest money in a product or enterprise in
order to make a profit, were those benefited the most from this economic
system

Entrepreneurs were protected by the government through protective tariffs

These tariffs made imported goods more expensive
Innovation

Thomas Edison was one of the most prolific inventors of the time

Edison patented over 1,000 patents including the light blub

What do you now have to create to have a light blub work?

In 1844 Samuel Morse perfected the telegraph

In 1876 Alexander Graham Bell patented the telephone


By 1900 there were more than one million telephones in the U.S.
In 1896 Guglielmo Marconi invented the wireless telegraph
Technology and Transportation

In the 1850’s, Henry Bessemer developed a process for purifying iron,
resulting in a strong and lightweight metal known as steel

This process became known as the Bessemer process


The expansion of the American railroad also brought about change


What can we build with steel?
Time zones were developed to make sure that trains would run on time from region
to region
The expansion of the railroads also made it easier to transport goods from one
place to another

With fast transport and an abundance of resources, American factories were able
to turn out large number of products quickly and inexpensively. This is known as
mass production
Corporations

To take advantage of expanding markets, investors developed a form of group
ownership known as a corporation

A number of people share the ownership of a company in a corporation



The benefit is a pooling of resources and a share in the liability
Corporations tried to make money by

Lower wages as low as possible, paying as little as they could for raw materials,
advertising, and paying inventors to discover new goods and technologies

Other like John D. Rockefeller made deals with railroads that decreased shipping
costs and helped in crease profits
Some corporations tried to become monopolies

A monopoly is when a business controls an entire market single handedly
Integration

Businesses use different models for integration: horizontal integration and
vertical integration

Consolidating many firms in the same business is called horizontal integration


While this was illegal in some states, forming a trust, where multiple companies are run
by a new organization, is not.
Andrew Carnegie, a steel producer, practiced vertical integration

Vertical integration involves owning all levels of production.

This helps reduces costs and allows you to charge competitors higher prices
Social Darwin and Government
Regulations

Many felt that the consolidation of power in trusts, cartels, and monopolies was
unfair


William Graham Sumner declared a state of Social Darwinism


This means that the businesses and people most fit to survive would adapt to the new
system and others would parish
In 1887, the United States Senate created the Interstate Commerce Commission
(ICC)


These business people were known as “robber barons” because of their unfair business
practices and their ability to cheat the poor
This organization was built to oversee railroads that crossed state lines and monitor fair
business practices
In 1890, the Sherman Antitrust Act outlawed any trust that operated across state
lines