![[audio]](../pics/audio.gif) The following information was presented
in this chapter:
The industrial revolution made the U.S. a rich country. But between
1870 and 1910, a small number of people, the owners of large businesses,
started to dominate the country's wealth by using competition and
cooperation.
- Lowering production costs using mass production techniques or
vertical integration
created opportunities for many companies to get competitive advantage
(a situation that one company dominates other companies that sell
the same kinds of products).
- Competition is good for consumers
by resulting in getting better product or service or getting lower
prices. But, businesses do not like competition because they make
less profit if they have to
lower prices or to find ways to make a product better.
- In the 1870s, businesses began to cooperate to decrease competition
because of depressions. In the first stage, businesses discussed
their problems together. In the second stage, businesses sometimes
cooperated by forming pools.
In the third stage, businesses often cooperated by forming rules.
In the fourth stage, holding companies legally controlled many businesses
producing the same product.
- Big business tried to dominate government in the late 1800s by
getting their supporters elected to office, getting themselves elected
to office, and using bribes
to influence other politicians.
Important dates to remember:
The depression of 1873
The depression of 1893
Who's who in this chapter:
James Hill's Great Northern Railroad had a competitive advantage
by lowering its production costs.
Andrew Carnegie's steel industry is a famous example of how vertical
integration can give a company a competitive advantage.
J. P. Morgan was a large bank owner who took advantage of the
depression by buying ownership of the many bankrupt
railroads. He also formed the basis for the U.S. steel monopoly.
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