Transcript
Chapter 9Industrialization
Section 3Big Business
The Rise of Big Business
Role of corporations◦Owned by many (stockholders) but law treats as
one◦Corp. can own property, pay taxes, make
contracts, sue & be sued Economies of Scale
◦Because of sell of stocks◦Make goods cheaply & quickly
2 types of costs◦Fixed Costs◦Operating Costs
Industry Consolidation
Pools◦Organized to stop prices from falling◦No legal protection (interfered with competition)
Andrew Carnegie◦Immigrant◦“rags to riches”◦Investments◦Bessemer Process-steel-Pittsburgh (1875)◦Vertical & Horizontal Integration
Vertical Integration
Horizontal Integration
Monopoly
When a single company achieves control of an ENTIRE market
Standard Oil◦John Rockefeller
Trusts & Holding Companies
Fear of large corporations & monopolies◦States-illegal for one
company to own stock in another (unless permission given) Standard Oil-formed a trust
◦Allows one person (trustee) to manage another’s property
New Jersey law◦Holding company
Selling the Product
New ways to market & sell goods
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