The growth of big

business13.2

What are “Robber Barons” and “Captains of Industry?”

•Robber Barons: People who built their fortunes by stealing

from others.• Captains of Industry: People who

built factories, expanded markets, and raised productivity

in a POSITIVE way

WHAT DO YOU THINK?

As we learn about these big businessmen, decide what you think they are?

Did they do good (Captain of Industry) or

bad (Robber Baron).

ANDREW CARNEGIE!• Captain of the

“STEEL” Industry– Drove his competitors

out of business by being the first to open steel plants using the Bessemer Process. (able to cut costs)

– Was a philanthropist– Preaches the “gospel

of wealth” stating that people should be free to make as much money as they can, however, they should then give it away

Carnegie Hall and Carnegie Library

Social Darwinism:• A Sociological Theory that society

should do as little as possible to interfere with people’s pursuit of success. (meaning Government, laissez-faire)

• Then those who are most fit would succeed and become rich. (People left to compete with one another)

• Society as a whole would therefore benefit and the unfit will be weeded out!

Monopoly: a company/person has complete control of a product or a service

Good or bad?

Gaining a competitive edge…

What if Starbucks had a monopoly on the coffee shop business?What could they do to the prices?What could they do to their product?

Cartel:• Loose association of businesses that make same product and agree to make a limited amount of product to keep prices high

• Our next “Big Businessman” began by being a part of a cartel…

John D. RockefellerCaptain of OIL

Standard Oil Company

Bought out his competitors too by using his relationship with other businesses.

Trust: a board of trustees who manage companies as a single unit

Methods of Industrial ControlHorizontal Integration:Bringing together many firms that were in the same business!

Vertical Integration:Gaining control of the many businesses that make up all phases of a product development!

Vertical Consolidation

Carnegie Steel Company

Coke (Coal) Fields

Iron Ore Deposits Steel Mills

Which one did they do?

CarnegieVertical!

RockefellerHorizontal!

People who built their fortunes by stealing from others are

referred to as:

A.ROBBER BARONSB.CAPTAINS OF INDUSTRY

C.ROBIN HOODSD.SOCIAL DARWINS

WHO IS THIS MAN?A.JOHN D.

ROCKEFELLERB.CORNELIUS

VANDERBILTC.ANDREW

CARNEGIED.SANTA

CLAUSE

TRUE(A) OR FALSE(B)??

John D. Rockefeller was the captain of

steel!FALSE!

Which of the following is NOT true about Social Darwinism?

A. Society should do as little as possible to interfere with people’ pursuit of success.

B. Then those who are most fit would succeed and become rich.

C. Society as a whole would therefore benefit and the unfit will be weeded out!

D. A loose association of businesses that make the same product and agree to make a limited amount of their product to keep their prices high!

WHICH OF THE FOLLOWING DESCRIBES HORIZONTAL

INTEGRATION?A. Bringing together many firms that

were in the same business!B. Gaining control of the many

businesses that make up all phases of a product development!

WHICH DO YOU THINK ROCKEFELLER AND CARNIGIE WERE??

A.ROBBER BARONSB.CAPTAINS OF

INDUSTRY