Rapid industrialization in the late 19th century was driven by technological innovations like the Bessemer process and Edison's inventions. Inventors like Edison, Bell, and the Wright brothers patented important innovations. New business entities like trusts and pools formed and businesses vertically and horizontally integrated. The ideology of laissez-faire encouraged free competition but trusts were eventually regulated by acts like the Sherman Antitrust Act. The economy experienced boom and bust cycles, and the Panic of 1893 was the worst economic downturn until the Great Depression.

1. The Incorporation of America US Studies Northwest High School

3. Drake’s steam-powered oil drill

4. Edison

5. “Wizard of Menlo Park”

7. The Phonograph (1877)

8. The Ediphone or Dictaphone

9. The Motion Picture Camera

10. Alexander Graham Bell Telephone (1876)

11. Alternate Current George Westinghouse

12. The Airplane Wilbur Wright Kitty Hawk, NC – December 7, 1903 Orville Wright

13. U. S. Patents Granted 1790s  276 patents issued. 1990s  1,119,220 patents issued.

14. Causes of Rapid Industrialization Unskilled & semi-skilled labor in abundance. Abundant capital. New, talented group of businessmen [entrepreneurs] and advisors. Market growing as US population increased. Government willing to help at all levels to stimulate economic growth. Abundant natural resources.

17. Adapted Darwin’s ideas to humans.

18. Notion of “Survival of the Fittest.”

19. Individuals must have absolute freedom to struggle, succeed or fail.

20. Therefore, state intervention to reward society and the economy is futile! (unnatural)Herbert Spencer

21. New Type of Business Entities Pool: A temporary grouping of two or more people to manipulate a businesses’ price and/or volume. Pooling resources is an example Trust: A legal organization set up for the control and management of assets and property of a business. It’s a way to manage several companies (Standard Oil)

22. Vertical Integration: A supply chain united by a common owner. Usually each member of the supply chain produces a different product but contribute to a final product (Carnegie & US Steel) Horizontal Integration: Occurs when a firm is being taken over by, or merged with, another firm which is in the same industry and in the same stage of production as the merged firm, e.g. a car manufacturer merging with another car manufacturer (a "buy out" or "take-over“) Types of Trusts

23. Examples

25. “rule of reason” loophole1895  US v. E. C. Knight Co.

26. Economy moves through three phases: Peak Recovery Panic (Recession; Depression—long recession) Panic of 1893: Worst until Great Depression of 1930s: Businesses cut production & fired workers (no unemployment insurance)—see Pullman Strike in next Powerpoint Jacob Coxey took unemployed men to D.C. to demand public works jobs (1st March on Washington) Laisez-faire government said no! Downside: Business Cycle