Industrial Revolution

Foundations for Economic Growth Abundant Natural Resources The “Free Enterprise” System Capitalist Free Market Social Darwinism The Role of Government “laissez-faire” Patent system Tariffs Fertile soil, swift flowing streams, timber, coal, iron ore, oil, phosphates, and copper Capitalist society, tools, factories, and other means of production are privately owned, people are free to buy and sell goods (market economy), cheaper better goods compete more effectively, competitive work ethic=social Darwinism (adapt, survive, thrive)

Foundations for Economic Growth The Legacy of the first industrial revolution Steam power, and mass production of goods Economic stimulus provided by the Civil War Money re-invested in manufacturing

Spread of Railways End of Civil War=35,000 miles of railroads 25 years later 5x that amount Transcontinental railroad- 1869 George Pullman- sleeping car Refrigerated cars- insulated with ice on the top Time Zones Stimulus to steal, iron and coal industries Shipment of goods

Technological Innovation Steel Bessemer process- cheaper to create good steel Communication Telegraph- transatlantic cable, 1858 then 1865 Telephone Electricity Phonograph Light bulb Nicola Tesla Oil First oil well- 1859 in Pennsylvania Petroleum, kerosene, gasoline 80% cheaper- railroads, steamships, suspension bridges, turbines and engines, and skyscrapers Tesla- worked for Edison from Serbia, Edison- direct current tesla- alternating current, teslas lasted longer and could travel longer distances, lit up Chicago’s world fair in 1893 Petroleum- lighting and machine lubrication, kerosene- lighting, gasoline- internal combustion engine

Women and African American Inventors Josephine Cochran- automatic dishwasher John Albert Burr- rotary blade lawn mower Granville T. Woods- telegraph that could send signals between trains Sarah Goode- first African American Women to have a patent, fold away bed tucked into a desk Madam C.J. Walker- hair car products, first African American millionaire

Effects of Industrialization Growing Population Emergence of a National Market Department stores and Mail Order Houses The Rise of the Corporation- large scale businesses Economies of scale in production Cheaper sources of supply Vertical integration- all parts of production Use of machinery on farms= more food= more people, rising demand for goods and supply of cheap labor Communication, transportation and manufacturing= national market department stores- woolworths, mail-order houses- sears and roebuck Corporation- issues stocks or shares of ownership economies of scale in production- larger businesses build larger facilities and can modernize faster cheaper sources of supply- order in bulk less exensive owned their own source of raw material, own transportation network, and manufacturing facilities

Entrepreneurs Andrew Carnegie (1835-1919)- vertical integration Scottish immigrant Bessemer Process Bought out competing companies Workers worked 12 hour shifts, day and night The Gospel of Wealth- give money away in lifetime

Entrepreneurs John D. Rockefeller (1839- 1937)- horizontal integration Standard oil company Purchased rivals Pipelines=bypass railroads Standard Oil Trust= 90% of all oil refining J.P. Morgan (1837-1913) General Electric Bought Carnegie steel in 1901- US Steel= the first billion dollar company in the US