The Industrial Revolution CHAPTER 13 The Industrial Revolution Section 1: Origins of the Industrial Revolution Section 2: The Factory System Section 3: New Methods and Business Organizations Section 4: Living and Working Conditions Section 5: Socialism

Capitalism SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Capitalism Economic system where individuals (not govt) controls the factors of production. Businesses and the means of production are privately owned and operated.

Commercial Capitalism: Merchants bought & sold goods. SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Commercial Capitalism: Merchants bought & sold goods. Industrial Capitalism: produce and manufacture goods.

Israel and the Occupied Territories SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Industrial Capitalism brings about a New Middle Class: businessmen, merchants, inventors benefited most from the Industrial Revolution they lived in nice homes, dressed well, ate large meals, and hired servants valued hard work as a way to "get ahead" thought poor people brought on their own misery - laziness and ignorance would keep them in poverty

SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Factories were built on the beliefs of Division of Labor and Interchangeable Parts Divided the jobs into steps Hire unskilled labor for each step DIVISION OF LABOR! Increased production All of this Lowered Costs = MORE PROFIT

Eli Whitney Parts were all alike interchangeable parts SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Eli Whitney Parts were all alike interchangeable parts Speedy production of inexpensive muskets Easily repaired!

Mass Production Producing large numbers of identical items SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Mass Production Producing large numbers of identical items What do you need for Mass Production? Division of labor Use of interchangeable parts An assembly line

Israel and the Occupied Territories SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations The Assembly Line Parts brought together to one location Carried from worker to worker Saved time and energy

Karl Benz 1886 first 3-wheeled auto SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Karl Benz 1886 first 3-wheeled auto

Henry Ford – Mass Production SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Henry Ford – Mass Production Used a conveyor belt Founded one of the largest industries in the world Model T would be assembled in 93 min. Other industries would mass produce items….

Rise of the Corporation SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Rise of the Corporation Partnership: two or more people own and run a business. Sole proprietorship: one person owns & runs the business.

Capitalist: investor in a business SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Capitalist: investor in a business …became more involved in producing and manufacturing goods ----

Big Businesses - Corporations SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Big Businesses - Corporations Company that allows people to buy “shares of stock” Each share would receive a portion of the profits By late 1800s, some corporations were very large and powerful. J.P. Morgan – US Steel

J.P. Morgan – U.S. Steel Corporation Pittsburgh, Pennsylvania SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations J.P. Morgan – U.S. Steel Corporation Pittsburgh, Pennsylvania Henry Bessemer - 1856 - British engineer who invented steel (made through a process of purifying iron ore) - steel was lighter, harder, more durable than iron.

SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Monopoly When a corporation gains COMPLETE CONTROL over the production or sale of a good/service

Cartel SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations Cartel When corporations join together to control every stage of an industry. Example: German steel industry -coal & iron mines -steel mills -factories

business cycle SECTION 3 Israel and the Occupied Territories New Methods and Business Organizations business cycle Alternating periods of prosperity and decline As industry became more and more important, it influenced the economies of many nations. depression