Sept. 18 Notes (Big Business)

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Sept. 18 Notes (Big Business)

  1. 1. Big Business
  2. 2. <ul><li>Major belief in the late 1800s </li></ul>“ Social Darwinism” <ul><li>“ Survival of the fittest” in the business world </li></ul><ul><li>People who are good at business will succeed </li></ul>
  3. 3. The businesses that “survived” were those that killed their competition! PROBLEM…
  4. 4. Entrepreneurs in the late 19 th Century (1800s) organized production to make increasing profit, leading to big business REMEMBER…
  5. 5. <ul><li>Uniting companies in the SAME industry </li></ul>Horizontal Consolidation <ul><li>Merger ~ buy out other companies </li></ul><ul><li>Trust ~ group of people runs separate companies as one large corporation </li></ul>
  6. 6. <ul><li>One company controls an industry’s production, quality, wages, and prices </li></ul>MONOPOLY <ul><li>Caused by mergers/trusts </li></ul><ul><li>Created in order to make more and more profit </li></ul>
  7. 7. <ul><li>Putting together companies from DIFFERENT industries </li></ul>Vertical Integration <ul><li>Buy out suppliers in order to control the quality & price of your product </li></ul>
  8. 8. <ul><li>Loss of competition leads to high prices </li></ul>Effects of Monopolies <ul><li>Poor working conditions </li></ul>
  9. 9. <ul><li>Monopoly owners </li></ul>Robber Barons <ul><li>Controlled the market to increase their own wealth </li></ul><ul><li>Didn’t share wealth with employees or consumers </li></ul>
  10. 10. <ul><li>Monopoly owners </li></ul>Robber Barons <ul><li>RESULT : wealth & resources were controlled by just a few people </li></ul><ul><li>Very few very wealthy people & many poor people </li></ul>
  11. 11. <ul><li>Examples… </li></ul>Robber Barons U.S. Standard Oil John D. Rockefeller
  12. 12. <ul><li>Examples… </li></ul>Robber Barons Banking Industry J.P. Morgan
  13. 13. <ul><li>Examples… </li></ul>Robber Barons Carnegie Steel Andrew Carnegie
  14. 14. <ul><li>1890~ Sherman Anti-trust Act </li></ul>Government Response <ul><li>Made monopolies illegal </li></ul><ul><li>Law was unsuccessful because it was not easy to enforce and was not upheld by the Supreme Court </li></ul>
  15. 15. The End

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