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How did increased productivity in factories affect the competitive nature of markets?

Industrialization Lesson 3. How did increased productivity in factories affect the competitive nature of markets?. Review . What determines Productivity? Resources Transportation Public Policy Technology. Industrialization = Era of Big Business. What is a big business?

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How did increased productivity in factories affect the competitive nature of markets?

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  1. Industrialization Lesson 3 How did increased productivity in factories affect the competitive nature of markets?

  2. Review • What determines Productivity? • Resources • Transportation • Public Policy • Technology

  3. Industrialization = Era of Big Business • What is a big business? • Gigantic companies that own numerous plants or factories and sell products nationwide • It requires a large investment, too large for one individual

  4. Types of big businesses • Corporations • Companies formed by a group of investors • Trust • Group of corporations come together to form one • Monopoly • One Business in control of a particular product • No competition

  5. How does a corporation become a monopoly? • Horizontal Integration • Buying up all the companies in your industry • Ex. Standard Oil Company – bought other oil companies • Impact?

  6. How does a corporation become a monopoly? • Vertical Integration • Buying up businesses that relate to one another • Ex. Carnegie Steel – owned iron ore mines, Rail road, and steel mills • Impact?

  7. How did big businesses (factories) affect the competitive nature of markets? • Positives • Lower Prices • Products reach all over U.S. • New products available • Negatives • Eliminates competition (smaller business can’t survive) • Monopolies may increase prices • Take less care of employees

  8. Captains of Industry • John D. Rockefeller • Owner of Standard Oil Company • Practiced Horizontal integration • Eliminated competition by lowering prices and spying on other companies.

  9. Captains of Industry • Andrew Carnegie • “Rags to riches” • Carnegie Steel • Vertical integration • Dirty Tactics • Philanthropist – gave away his money

  10. Discussion Questions? • What happened to Competition during the Industrialization era? • Who is supposed to monitor this? Why didn’t anyone stop it? • Can you think of a big business today that has low prices and uses them to eliminate the competition?

  11. How do the people feel about these large companies and their leaders? • Use the political cartoons to answer the following questions on a separate sheet of paper. • Identify the symbols and characters in the cartoon. (list) • What does each symbol represent? • Describe the action taking place in the cartoon. • What is the cartoonist trying to say?

  12. Political Cartoons

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