Topic 4: The Rise of Industry

1 Factor Contributing to Industrial Growth

Abundance of natural resources:

• fertile soil

• timber

• swift-flowing streams

• deposits of coil, iron, oil & copper

2 Factor Contributing to Industrial Growth

Laissez-faire capitalism:

• minimal government intervention, hands-off approach to business regulation allowed private enterprise to grow

• facilitated competition, innovation, and investment, encouraged risk-taking, rapid growth of industries

3 Factor Contributing to Industrial Growth

Population Growth:

• higher birth & survival rates

• waves of immigration from Europe provided a large and cheap labor, force factories, mines, & construction

4 Factor Contributing to Industrial Growth

Access to Capital:

• modern banking and financial systems establishment of national banks

• The New York Stock Exchange, facilitated the flow of capital to find industrial projects and ventures

5 Factor Contributing to Industrial Growth

Communication Advancements:

• Telegraph and telephone, improved coordination and management in industrial operations

6 Factor Contributing to Industrial Growth

Patent System:

• U.S. patent system encourage inventors and innovators to protect their intellectual property rights

1 New Industries and Inventions

Internal Combustion Engine:

• at the end of 19th century

• used to controlled explosions to move piston in cylinder

2 New Industries and Inventions

Airplane (1903):

• created by Wilbur and Orville Wright

• powered by the internal combustion engine

3 New Industries and Inventions

Henry Ford:

• Less expensive automobile

4 New Industries and Inventions

The Telephone (1876):

• created by Alexander Graham Bell

• carried a variable current to a receiver capable of reproducing the human voice

Steel Industries

Bessemer Process:

• air blown into hot pig iron to remove impurities 

• reduced the cost of making steel by 80%

Andrew Carneige:

• adopted the Bessemer process

• built large  steelwork

Oil Industries

Edwin Drake:

• first oil well drilled in Pennsylvania (1859)

John D. Rockefeller:

• Standard Oil Company

• Kerosene and gasoline; railroad rebates; pipeline transport

Railroad Industries

• Expansion of the network and the construction of a national transportation system made it easier to move raw materials, goods, and people across the U.S.

• Reduced transportation costs and improved market access

Electricity Industries

Electric Light Bulb:

• created by Thomas Edison

• motion pictures (1896)

• improved battery; electric power station

• backed by J.P Morgan

Alternating Current:

• Nicola Tesla 

The 1st Industrial Revolutions

• began in U.K textile industry (1700’s)

• spread to other European country and to the colonies

• marked by the introduction of steam power and the factory system

• Coal & Iron became key resources

The 2nd Industrial Revolutions

• dominated by steel, oil, and electricity

• advancement in internal combustion engines

• new inventions and innovations

• rise of corporations (ability to raise more capital)

• contribution of entrepreneurs

New England Factory

initial phase of industrial was concentrated in New England, driven by textile manufacturing and the mechanization of production processes in textiles mills

Nationwide Industrial Growth

expansion beyond New England and proliferated across the U.S. including the Midwest and West

Invention

to design something new; a new device or process for making things

Innovation

to apply or adopt new machines, processes and/or products

Transportation and Communication (Nationwide Market for Goods)

• 2nd Industrial revolution improved transportation and communication network

• railroads expanded connections

Labor and Immigration (Nationwide Market for Goods)

• the labor force in the second Industrial Revolution included a significant influx of Europe

• Demographic shift had profound social and economic implications

Corporate Growth and Consolidation (Nationwide Market for Goods)

• The second Industrial Revolution saw the emergence of large corporations and trust that exerted significant control over various industries

• experienced labor strikes and the rise of labor unions as workers sought better condition and wages

Emergence of national market

Replacement of separate regional markets by a single national market-cheaper transportation goods, telegraph, telephone improved communications, the population expanded, a new methods of advertising and selling were developed

Corporation

Characterized by the investment of private financial resources, competition with economic like Britain’s, as U.S. became one of the most economically powerful countries in the modern world

Entrepreneurship

Identifying opportunities taking calculated risks, creating or expanding business to achieve growth and profitability; drive innovation and economic growth, introducing new products or services, and finding ways to meet need in the market

Trust

Merging multiple companies or corporations under a single entity, often managed by a board of trustees

Monopolies

A singe, company or entity dominates an entire industry or market, effectively eliminating competition

Horizontal Intergration

Buying the competition

Vertical Integration

Control the making of materials, the transportation, sell, and delivery