topic 6.6 - the rise of industrial capitalism

consolidation

the business process of merging smaller companies into larger ones to reduce competition

Cornelius Vanderbuilt

-used his millions earned from steamboat business to merge local railroads into the New York Central railroad, running from NYC to chicago

Jay Gould

-entered railroad business for quick profits and made millions by selling assets and watering stock (inflating asset value before selling)

JP Morgan

-banker

consolidating railroads and forming major corporations like U.S. Steel and General Electric

Andrew Carnegie

-manufactured steel in Pittsburgh

-used vertical integration

-Carnegie Steel—→ sold it to JP Morgan when he retired to pursue philantrophy

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John D Rockefeller

-in charge of Standard Oil Trust/ controlled over 90% of oil refinery buisness

-used horizontal integration

-was a monopoly, a company that dominated market so much it faces no competition

trust

-organization or board manages assets of other companies/ like standard oil had one board of trustees that managed a combination of oil companies

Horizontal Integration

-Rockefeller + oil industry

-company takes control of its former competitors in an industry to eliminate competition

vertical integration

company takes control of all the stars of making a product

-Carnegie Steel

Social Darwinism

a late 19th-century ideology that misapplied Charles Darwin’s biological theory of natural selection—"survival of the fittest"—to human societies, economics, and politics

Horatio Alger

-wrote novels portraying young men who becomes wealthy through honesty, hard work, and a little luck