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Page 1: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

Rise of Big

BusinessTextbook Notes

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Page 2: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

Factors of Production Start on page 568

• The period from the end of the Civil War and 1900 was an era of unmatched economic growth in the United States.

Page 3: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• New methods of technology and

business allowed the country to tap its

rich supply of natural resources,

increase its production, and raise the money

needed for growth.

Page 4: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• The growing transportation system made it easier for

merchants to reach distant markets.

Page 5: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

Among these resources are what economist call

the factors of production: Land, Labor,

Capital

Page 6: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

•Land: not just the land itself but all the

natural resources

Page 7: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Labor: Large number of workers was needed to turn raw materials into goods.oThis was met by the

rapid growth of population.o Between 1860 and

1900; the population of the country more than doubled.

Page 8: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Capital: the equipment, buildings, machinery, and tools used in production. The term capital is also used to mean money for investment. Huge amounts of money were needed to finance industrial growth.

Page 9: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

The Oil Business Page 569

• The oil industry grew rapidly in the late 1800s.• John D. Rockefeller made his fortune

from oil. • When Rockefeller was 26 years old, he

and four partners set up an oil refinery (to process oil) in Cleveland, Ohio.

Page 10: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• In 1870, Rockefeller organized the Standard Oil Company of Ohio and set out to dominate the oil industry. • He acquired most of

the oil refineries in Cleveland and other cities.

Page 11: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

The Standard Oil Trust• To strengthen Standard Oil’s

position in the oil industry, Rockefeller lowered his prices to drive competition out of business. In addition he pressured customers not to deal with rival oil companies, and he persuaded the railroads to grant him rebates in exchange for his business.

Page 12: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

The Steel Industry Page 570

• Steel also became a huge business in the late 1800s.

• Steel is a strong and long-lasting form of iron-treated with carbon- the ideal material for railroad tracks, bridges, and many other products.

• Before 1860s steel was not widely used because it was expensive to manufacture. The development of new manufacturing techniques helped overcome this problem.

Page 13: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• The Bessemer process, developed by Henry Bessemer changed the industry. With new methods, mills could produce steel at affordable prices and in large quantities.

Page 14: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• In the 1870s, large steel mills emerged close to the sources of iron ore in western Pennsylvania and eastern Ohio.

Page 15: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Pittsburgh, Pennsylvania became the steel capital of the United Sates.

The leading figure in the early years of the American steel industry was Andrew Carnegie, son of a Scottish immigrant.

Page 16: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

Railroad BaronsGo back to page 557

• New Yorker, Cornelius Vanderbilt, one of the first Railroad barons, gained control of the New York Central Line and then made a fortune by consolidating several companies. His railroad empire stretched from New York City to the Great Lakes.

Page 17: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Railroad barons were aggressive and competitive. They lived in an age when few laws had been passed to regulate business and some of their methods were highly questionable.

Page 18: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Nevertheless, the railroad barons played an important part in building the nation’s

transportation system.

Page 19: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

Philanthropists Back to page 570

• Andrew Carnegie, John Rockefeller, and other industrial millionaires of the time grew interested in philanthropy- the use of money to benefit the community.

Page 20: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• The philanthropists founded schools, universities, and

other civic institutions across the United States.

Page 21: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Carnegie donated $350 million to various organizations. He built Carnegie Hall in New York City; the Carnegie Foundation for Advancement of Teaching; and more than 2,000 libraries worldwide.

Page 22: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

• Rockefeller used his fortune to establish the University of Chicago in

1890 and New York’s Rockefeller Institute for Medical Research.

Page 23: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth
Page 24: Factors of Production Factors of Production Start on page 568 The period from the end of the Civil War and 1900 was an era of unmatched economic growth

The Progressive

Era

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