The Gilded Age and the Rise of Big Business -How did the US gain industrial leadership?

Résumé du document

Industrialization is process driven. It is a steady process by which manufacturing industries develop from within a predominantly agrarian society. Through industrialization, social and economic changes are prevalent. This is followed by an increase in input and output at a per capita income level. Industrial growth in the US bloomed in the early 1800s. After the Civil War between 1861 and 1865, the American industry was still small, rural based, with limited capital. Its trade and business area comprised of sole proprietorships which were widely dispersed. It was not until 1880, that agriculture was the chief source of wealth in the US. Moreover, hand labor was still widespread and rampant. This accordingly limited the production capacity of the industry at large. However, the industrialization process accelerated at an alarming pace during the last thirty years of the 19th century and the US soon emerged as a highly complex and dynamic industrial economy. This had a dramatic impact on every aspect of life in America. A significant reformation occurred when industrialists began to dominate many aspects of the nation's future, including social and political affairs. However, the question that arose was how did the US gain industrial leadership? A careful reflection has confirmed that there are three groups that together played an important role in the process of industrialization and whose actions led to the strong foundation of the industrial leadership in the US. To elucidate further, the three groups were the inventors, the trendsetters (in terms of business and management) and the government.

Extraits

[...] Those new techniques of production and management were rapidly used in other countries. Motivated by higher profits, the holders of companies decided to cooperate, which led to monopolization of the industry and allowed companies to be stronger. The government was aware of this and wanted to control monopoly power, so it created legislation, but those attempts were quite useless and the US gained industrial leadership. Bibliographie Atack Passell (1994) A new Economic View on American History.ch.17 Walton, Rockoff (2005) History of the American Economy.ch. [...]

[...] There are three groups that altogether played an important role in the process of industrialization and whose actions led to US industrial leadership. They are the inventors, the trendsetters (in terms of business and management) and the government. The inventors in the US process of industrialization In America, inventors brought a lot of changes through new technologies and new sources of energy contributing to the rise of big business. New technologies Thanks to new inventions, manufacturing increased. In the 1870s and 1880s, a lot of technological changes occurred. [...]

[...] Up until 1880, agriculture was still the chief source of wealth in the US. Moreover, hand labor was still widespread, which accordingly limited the production capacity of industry. However, the industrialization process quickly accelerated during the last thirty years of the 19th century and the US soon emerged as a highly complex industrial economy. This had a dramatic impact on America's every aspect of life and industrialists came to dominate many aspects of the nation's life, including social and political affairs. But how did the US gain industrial leadership? [...]

[...] Mass production (the production of large quantities of a standardized article often using assembly line techniques through systematization) came to complement mass distribution. Thus, through more effective management and coordination of production and distribution, manufacturers could lower costs and increase productivity. A new kind of enterprise emerged: the modern business enterprise. This new enterprise was characterized by many distinct operating units (labor division) and was managed by a hierarchy of salaried employees. These companies employed energy consuming and capital-intensive production methods. This increased firm size and the minimum efficient scale of operation. [...]

[...] Trusts gained economic power in the US in the late 19th and early 20th centuries. Government action In response to those movements towards trusts, government soon tried to control monopoly power through legislation. As soon as 1890, the Sherman Antitrust Act came into force. It was the first attempt to limit cartels and monopolies. This act declared illegal “every contract, combination in the form of trust or otherwise, or conspiracy in restraint of trade or commerce among the several States, or with foreign nations”. [...]