The rise of large corporations in the late 19th century transformed the US economy from agricultural to industrial. Corporations like Standard Oil formed through mergers and acquisitions that eliminated competition, allowing them to control entire industries. This concentration of economic power benefited corporate leaders but hurt many workers and small businesses, raising concerns about monopolies and leading to calls for government regulation of big business.

2. Industrialization in the United
States in the late 19th and early
20th centuries was
characterized by the rise of
corporations.

3. Analyze how the
rise of
corporations, trans
formed the
American economy
from an agrarian to
an increasingly
urban industrial
society.
Write the
objective
in your
handout.

4. Definitions associated with
corporations
Write:
 Shares: one of the equal
fractional parts into which
the stock of a corporation is
divided and sold on the stock
exchange.
 Stocks: the shares of a
particular company or
corporation.
Write

5. Write:
A company
controls all
or most of
the sales of
a specific
good or
product.

6. Corporation
OWNED BY
INDIVIDUALS
BOARD OF
DIRCTORS
makes decisions
CORPORATE
OFFICERS run day-
to-day operations
ADVANTAGES
TO EXPAND the
business, it can raise
money by selling
shares of stock
STOCKHOLDERS
can lose only
what they invest
IT CAN
CONTINUE TO
EXIST after its
founder leaves
In the 1800s
COMPETITION was
fierce. To gain
dominance some
companies merged to
form a trust
BOARD OF TUSTEES
ran it like a single
corporation
When a trust gained
complete control over
an industry it held a
monopoly
Monopoly had no
competition. It could
raise prices or lower
quality at will.

7. Write:
Corporations
originated
during the
U.S. Second
Industrial
Revolution
4. When did corporations
originate?
TODAY’S CORPORATIONS

8. Definitions associated with corporations
 Entrepreneurs
 Market Economy
 laissez-faire
 Monopoly
 Social Darwinism

9. Write:
Heavy industry
companies grew so
large that they
evolved into
corporations.

10. Write:
Entrepreneurs were willing
to risk large sums of money
in new business, and were
fiercely competitive trying
to stomp out the
competition.
Much of the public attitude
thought the competition
was perfectly natural.
6. How did entrepreneurs and
public attitudes help the rise
of big business (corporations)
in the late 1800s?

11. Write: A system of
distributing
resources based
only on the
interaction of
market forces, such
as supply and
demand.

12. Write:
 Supply is how much of something is available.
 Demand is how much of something
 people want.
 Put the two together, and you have supply and
demand.
 Generally speaking, the price of something will go
up if the demand goes up.

13. Write:
 A true market economy is
free of governmental influence
(laissez-faire) , and other
external interference.
 Before the Progressive Era,
the United States was an
example of a Market Economy.

14. Write:
It means “hands off.” It
describes the approach
that government took
concerning businesses.
They did not interfere in
the affairs of business.
Prices, quality and
competitive practices are
solely determined by
competition.
Read but do not write:
This approach was
advocated by the English
economist Adam Smith in
his work The Wealth of
Nations and followed by
the US government up
until the late 1800’s, early
1900’s

15.  Market Economy
(capitalism)
 A system distributing
resources based only on
the interaction of market
forces such as supply and
demand—free of
governmental influence

16. Write:
 It is a view of society based on Charles Darwin's scientific theory of
natural selection
 It is a belief that natural selection also applied to society. Stronger
people, businesses, and nations would prosper. Weaker ones would fail.
Write: This
theory gave
business the
excuse for not
providing very
well for their
workers.

17. The Rise of Big Corporations
Big business prospered in the late
1800s because of entrepreneurs
Started new ventures within
the economic system called
free enterprise or market
economy (businesses are
privately owned)
Laissez-faire market economy
companies operated without
government interference----
was used during the late 1800s to
justify unregulated business growth
Huge inequalities under market
economy—entrepreneurs became very
rich but their workers were extremely
poor
Some people explained
inequalities by a philosophy
known as Social Darwinism
Social Darwinism: Stronger
people, businesses, and
nations would prosper.
Weaker people and
businesses would fail.

18.  taking over other
companies that make
that same product as
your company so as to
reduce the competition
 Rockefeller took over
other refineries.
Horizontal integration
Example: Oil Monopoly

19.  Acquiring companies that
supply that necessary
materials for production or
companies that transported
the materials that the
company produces
 Rockefeller acquired
companies that supplied
the oil business, such as
pipelines and railroad cars.
vertical integration
Example: Oil Monopoly

20.  He acquired companies that
supplied the oil business and
took over other oil refineries,
eliminating his competition.
 He eventually controlled 90%
of the world oil
trade=MONOPOLY.
Example Oil Monopoly

21. In 1904 Puck
published an iconic
cartoon “Next!”. It
shows an oil
tank/octopus hybrid
with the name
“Standard Oil” on the
Tank. The octopus
has arms “wrapped
around the steel,
copper, and shipping
industries, as well as
a state house, the
U.S. Capitol, and one
tentacle reaching for
the White House.”

22. Write:
 (1839–1937) American
industrialist and
philanthropist;
 he made a fortune in the oil
business and establish a
monopoly in the oil business
12. Identify
John D. Rockefeller

23. Write:
(1835–1919) American
industrialist and
humanitarian; he focused
his attention on
steelmaking and made a
fortune
 Carnegie Steel Company
 Monopoly--dominated
the American steel
industry.
13. Identify Andrew Carnegie

24. Write:
 (1794–1877) American business
leader who controlled (had a
monopoly) the New York Central
Railroad and up to 4,500 miles of
railroad track;
 he later donated $1 million to a
Tennessee university.
14. Identify: Cornelius Vanderbilt

25. Write:
 (1831–1897) American
business leader who
made a fortune in the
railroad business by
designing and building
railroad cars, including a
sleeper car.
15. Identify: George Pullman

26. Write:
Some Americans viewed
the tycoons of the late
1800s as robber barons,
who:
 destroyed competitors
with tough tactics
 Did not care for the
welfare of their workers
 Gathered huge wealth
for themselves
16. Define: Robber Barons

27. Write:
Some Americans viewed the
tycoons of the late 1800s as
robber barons, destroying
competitors with tough tactics.
Others, however, saw them as
captains of industry, using their
business skills to strengthen
the economy.
17. Do you think the four industrialists
discussed in the text are best described
as “robber barons” or “captains of
industry”? Explain your answer.

29. READ:
The economic and political power of trusts became a
concern for the American public during the late
1800s. (Trusts control many companies in an industry
through a single board of directors.)
By lowering prices and fixing costs and expenditures,
trusts drove many smaller companies out of
business. For example, John D. Rockefeller and his
associates formed the Standard Oil Company of Ohio
in 1870. By 1882 the company monopolized nearly all
of the U.S. oil industry.

30. READ:
Such a concentration of wealth and economic power
dramatically influenced the landscape of the United
States economy.
As a result, most Americans were very suspicious
of trusts. Although trusts were capable of efficient
production, they usually did so at the expense of their
workers who often earned just enough money for
survival.
In addition, by monopolizing entire segments of
industry, trusts threatened to squeeze small and
emerging businesses out of existence.

31. Analyze how the rise of corporations,
heavy industry, and technological
innovations transformed the American
economy from an agrarian to an
increasingly urban industrial society.
Essential Questions
Did rapid industrialization improve the
lives of Americans?
Are the benefits of progress worth the
costs?