Benchmark Team Leaders meeting after Benchmark DO NOW
• Benchmark: ______ • Team Leader’s meeting – after Benchmark • DO NOW: Continue Industry Activity List • What is the difference between a “mom & pop” store and a corporation? • Can you give examples for:
New ways of organizing business in the th 19 century (mid-late 1800’s):
Three terms that describe our economy: • Capitalism: private ownership. Owner decides what/how much to make, where to sell, etc. • Free Enterprise: government usually does not interfere with business • Laissez Faire: French term: allow to do (let be)- “government hands off”
New ways to expand businesses: • Corporations: sold shares of stock in their company to investors, run by a Board of Directors that make the day-day decisions. • Monopolies: control of an entire industry • Trust: groups of corporations run by a single Board of Directors
Powerful 19 th century leaders: • Vanderbilt: Railroads (“Commodore” & Railroad Baron) • Carnegie: Steel (“King of Steel”) • Rockefeller: Oil (Standard Oil Trust had 90% control of the Oil industry) • J. P. Morgan: Banking (loaned capital ($)
Imagine - • Imagine that you owned a company, what methods would you use to eliminate your competition?
Vertical and Horizontal Integration • Andrew Carnegie used • Vertical Integration: owning the businesses involved in each step of a manufacturing process. To lower production costs, Carnegie bought the iron ore mines, the coal fields, and the railroads needed to supply his steel mills. • Rockefeller used both vertical and horizontal integration. • Horizontal integration: owning all the businesses in a certain field
Example: Vertical Integration
Example: Horizontal Integration
Robber Barons or Captains/Pioneers of Industry? • Robber Baron: low wages to employees, limited competition, ruthless methods of doing business • Captain of Industry: developed efficient methods of business, allowed individuals to invest, donated millions to charity (philanthropists)
Government Involvement: • Sherman Antitrust Act: outlawed monopolies and trusts that restrained (stopped) trade or competition. • Effects: Why do you think this Act was difficult to enforce?
Corporations: • Positives: • Helped American industries to grow • Thousands of people bought stocks. • Millions of $ borrowed from banks • Stockholders are not personally responsible for the debts of the business • Stockholders may sell their shares • Negatives: • Large corporations force many smaller businesses to close • Limited competition allowing prices to increase
Team Activity Directions: • In packets: Teams review and evaluate the assigned information (bio information, political cartoon, and quotes) on either Andrew Carnegie or John D. Rockefeller • Use key information to complete your Robber Baron and Captain of Industry/Industrial Pioneer scale (3 bullet points for each side). • Based on your scale information, evaluate whether your team’s assigned business leader was a Robber Baron or Industrial Pioneer.
Venn Diagram: Directions: Develop a Venn Diagram that includes information about the following: • • Early years Key industries Methods used Philanthropy
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