Vanderbilt Morgan Carnegie Rockefeller Horizontal Integration Buying up

Vanderbilt Morgan Carnegie Rockefeller

Horizontal Integration- Buying up all competition in the same industry Vertical Integration- Owning all steps of a business in order to take a product from raw material to finished product

Horizontal

Growth of RR industry, led to the growth of the steel industry Henry Bessemer created the Bessemer Process Enabled steel makers to produce strong steel at a lower cost much faster.

Pittsburg, PA becomes one of the leaders in steel production The boom in the industry brought jobs and prosperity to the cities Negative effects Air and water pollution

What is horizontal and vertical integration? How did the Bessemer Process improve the steel industry? Explain the positives and negatives of the steel industry growth in cities.

Dominated the Steel Industry Began buying up all phases of the steel industry Iron mines, railroad and steamship lines, and warehouses Vertical integration

“Gospel of Wealth” Carnegie believed in giving to those who were less fortunate. Sold his steel empire in 1901 and spent the rest of his life helping people and donating to charity

What industry did Andrew Carnegie lead? How did he use vertical integration? What was the “gospel of wealth”?

Most powerful banker and investor of industrial age. Used his banking profits to gain control of other major corporations. Gained control of most of the nation’s RR’s. Became head of U. S. Steel Co. which was the first American business worth over $1 billion. “I like competition, but I like combination more. ”

Rockefeller built oil refineries when everyone else was drilling for oil. He bought up all competition. Used horizontal integration He started his own large company called Standard Oil. Eliminated competition by forming trusts Trust- a group of corporations run by a single board of directors

He slashed prices to undercut competition. Forced RR companies to grant rebates and lower shipping costs to keep his business The Standard Oil trust allowed Rockefeller to call the shots for all the companies that he overtook.

What was J. P. Morgan? How did this help him become such a dominant businessman? What industry did John D. Rockefeller work in? Explain how Rockefeller capitalized on the oil industry.

Many Americans felt that trusts and monopolies went against the free enterprise system. Free enterprise system- businesses are owned by private citizens. They felt that it eliminated competition and without competition there was no reason for companies to keep prices low or improve

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