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TheRiseofBigBusiness
The Gilded Age I. The Gilded Age = time period dominated by big
business, political corruption and extremes of wealth and poverty.
A. Gilded = covered with gold but cheap/trash underneath
II. The United States experienced an economic shift
from a predominantly rural agricultural nation to an urban industrial one.
III. Industrialization will lead the U.S.A. to
obtain wealth and power like never before
Major Developments
I. During the Gilded Age The United States of America changed in three major ways:
A. Industrialization - industrial production
B. Urbanization – Americans moved to cities
C. Immigration – people moved to the USA from other nations
The Way We Were in The Gilded Age: 1877-1901 Who We Were How We Lived
1880 1890 1900 1880 1890 1900 Population (millions) 50.2 63.0 76.0 Gallon of
milk $0.16 $0.17 $0.30 Pop. per sq. mile 16.9 21.2 25.6 Loaf of
bread $0.02 $0.02 $0.03 Percent rural 71.8% 64.9% 60.4% New
auto N/A N/A $500 Percent urban 28.2% 35.1% 39.6% Gallon of
gas N/A N/A $0.05 Percent native born 94.4% 87.1% 84.4% New
house $4,500 $5,800 $4,000 Percent immigrant 5.6% 12.9% 15.6% Average
income $480 $660 $637
TheGildedAge
I. ModernAmericadevelopedduringtheGildedAgeII. TheGildedAgeistheageofexcess (too much)
A. BigbusinessB. BiglaborC. Bigci>esD. Biggovernment
III. TechnologicalprogressallowedtheUSAtoshiCtoamodernindustrialna>on
America’sSecondIndustrialRevolu>on
I. America’sindustrializa>onwasonlypossiblethankstonewtechnologies:A. Electricity,steamship,railways,Bessemer
furnace(steel),machinetools,assemblylineII. Industrializa>onalsoneeded:A. Rawmaterials,largelaborforce,industrial
entrepreneurs,growingmarkets,laissez-faireeconomics
Businessgetsbig
Laissez-Faire(handsoff) I. Laissez-faireeconomics=the
governmentlargelykept“handsoff”towardsAmericanbusiness.A. TheAmericangovernmentdid
nothingtocontrolbigbusinessesintheUSA
B. BusinesseshadnorulestofollowandoCendidthingsgoodforprofitsbutbadforconsumers
II. Laissez-faireeconomics
allowed“BigBusinesses”toform
SOCIALDARWINISMI. Thepolicy/ideaofSocial
Darwinism=inbusinessitshouldbesurvivalofthefiYest
II. Onlystrongbusinessessurviveandweakonesshouldgooutofbusiness
III. Thewealthiestmenandthebiggestcompanieswillhavetheallthecontrol
BusinessGrowthI. Bigbusinessesbeganusingtwonew
businessstrategiesinordertomaximizeprofits
II. Ver&calintegra&on=controlofeverystepinproduc>onprocessbyonecompany
A. Companies would buy all the suppliers in one industry and keep other companies from purchasing raw materials needed to make a product
III. Horizontalintegra&on=controlofthemarketforasingleproductbyasinglecompany
A. Buying all businesses in the same market so one company controls the entire market (monopoly)
I. Both methods of integration allowed big businesses to form in the USA à drove competing businesses out
II. Businesses created monopolies leading big businesses to grow even bigger
BigbusinessneedsRR
I. RailroadswerenecessaryforthedevelopmentofbigbusinessestoformA. RRTiedsprawlingna>ontogetherB. RROpenedthecountrytoexpansion
II. RRalsoprovidedcommercialassistancetobigbusinessesA. BroughtrawmaterialstomanufacturersB. Tookfinishedgoodstoconsumers
III. WithoutRRbigbusinesseswouldnotbeabletoformintheUSA
BigBusiness
I. BigbusinessestookrootintheUSAduringtheGildedAge
II. BigBusinesseswereallowedtogrowthanksto:A. SocialDarwinism,Laissez-faireeconomics,Ver>cal&
HorizontalIntegra>on,Trusts,HoldingCompanies
III. BusinesseswillgrowbiggerandbiggerintheUSAandtakemorecontrolofthepeopleandgovernmentintheprocess
AREYOUWITHME??
① WhatwerethethreemajorshiCsthatoccurredinAmericansocietyduringtheGildedAge?
② WhatwastheeconomicshiCthatoccurredintheUSAduringtheGildedAge?
③ Howdidlaissez-faireeconomics&SocialDarwinismallowbusinessestogrowrapidly?
④ Explainthedifferencebetweenver>calandhorizontalintegra>onduringtheGildedAge