Andrew CarnegieAndrew Carnegie

Millionaire Steel Mill operator.Millionaire Steel Mill operator. Worth 500 million dollars.Worth 500 million dollars. Practiced Practiced

Vertical & HorizontalVertical & Horizontal

Integration.Integration.

HORIZONTAL VS. VERTICAL HORIZONTAL VS. VERTICAL INTEGRATIONINTEGRATION

VERTICAL INTEGRATIONVERTICAL INTEGRATION

OWNERSHIP OF A BUSINESS OWNERSHIP OF A BUSINESS INVOLVED IN EACH STEP OF THE INVOLVED IN EACH STEP OF THE MANUFACTURING PROCESS..MANUFACTURING PROCESS..

PRACTICED BY ANDREW CARNEGIEPRACTICED BY ANDREW CARNEGIE WHAT WAS THE BENEFIT OF VERTICAL WHAT WAS THE BENEFIT OF VERTICAL

INTEGRATION?INTEGRATION? RELIABLE TRANSPORTATION, AND RELIABLE TRANSPORTATION, AND

STEADY AMOUNT OF RAW MATERIALSSTEADY AMOUNT OF RAW MATERIALS

EACH STEP OF THE EACH STEP OF THE MANUFACTURING PROCESSMANUFACTURING PROCESS

TRANSPORTATIONTRANSPORTATION

TRANSPORTATIONTRANSPORTATION

CHEAP AND RELIABLE FORMS OF CHEAP AND RELIABLE FORMS OF TRANSPORTATION TO GET RAW TRANSPORTATION TO GET RAW MATERIALS TO STEEL MILL MATERIALS TO STEEL MILL

AND DELIVER THE FINISHED AND DELIVER THE FINISHED PRODUCT TO THE BUYER.PRODUCT TO THE BUYER.

HORIZONTAL INTEGRATIONHORIZONTAL INTEGRATION

OWNERSHIP OF SEVERAL COMPANIES THAT MAKE OWNERSHIP OF SEVERAL COMPANIES THAT MAKE THE SAME PRODUCT.THE SAME PRODUCT.

OR EXPANSION OF ONE AREA OF PRODUCTION.OR EXPANSION OF ONE AREA OF PRODUCTION. PRACTICED BY JOHN D. ROCKEFELLER, & PRACTICED BY JOHN D. ROCKEFELLER, &

WASHINGTON DUKE.WASHINGTON DUKE. WHAT WAS THE PROBLEM WITH HORIZONTAL WHAT WAS THE PROBLEM WITH HORIZONTAL

INTEGRATION? INTEGRATION? ELIMINATED COMPETITION, ELIMINATED JOBSELIMINATED COMPETITION, ELIMINATED JOBS

US Standard Oil trust certificate from 1896

SHERMAN ANTI TRUST ACTSHERMAN ANTI TRUST ACT

WHAT WAS IT?WHAT WAS IT? A LAW PASSED IN 1890 TO A LAW PASSED IN 1890 TO

ELIMINATE MONOPOLIES.ELIMINATE MONOPOLIES. WHY WERE MONOPOLIES BAD WHY WERE MONOPOLIES BAD

ECONOMIC PRACTICE?ECONOMIC PRACTICE?

Homestead Steel Homestead Steel strikestrike

Description:Description:Strikers at Homestead, Strikers at Homestead, Pennsylvania. The Populist Pennsylvania. The Populist platform appealed not only to platform appealed not only to farmers caught in an farmers caught in an economic squeeze; it also economic squeeze; it also addressed the interests of addressed the interests of laboring men. A series of laboring men. A series of strikes in the 1890s made it strikes in the 1890s made it clear that the government's clear that the government's interests lay with interests lay with businessmen and industrial businessmen and industrial leaders rather than the leaders rather than the workers. In 1892, Andrew workers. In 1892, Andrew Carnegie and Henry Frick Carnegie and Henry Frick (1849-1919) announced that (1849-1919) announced that they were lowering wages at they were lowering wages at their Homestead Steel plant their Homestead Steel plant by 20%. When the by 20%. When the Amalgamated Iron and Steel Amalgamated Iron and Steel Workers called a strike, Frick Workers called a strike, Frick locked out the strikers, who locked out the strikers, who then surrounded the plant.then surrounded the plant.

VERTICAL AND HORIZONTAL VERTICAL AND HORIZONTAL INTEGRATIONINTEGRATION

BOTH TYPES OF INTEGRATION ARE BOTH TYPES OF INTEGRATION ARE CONSIDERED MONOPOLIES.CONSIDERED MONOPOLIES.

WHICH WOULD MAKE YOU THE MOST WHICH WOULD MAKE YOU THE MOST MONEY & WHY?MONEY & WHY?

MANY INDUSTRIALIST WERE MANY INDUSTRIALIST WERE REFERRED TO AS ROBBER BARONS REFERRED TO AS ROBBER BARONS FOR THEIR RUTHLESS TATIC IN FOR THEIR RUTHLESS TATIC IN BUSINESS.BUSINESS.

ANDREW CARNEGIE’SANDREW CARNEGIE’SGospel of WealthGospel of Wealth

The wealthy should donate their The wealthy should donate their money to worthy causes.money to worthy causes.