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The Rise of Big Business in the Late 19th Century
Introduction
Big business was a period defined by the hiring of many workers by large corporations, resulting in industrialization in America. Most institutions deployed management to regulate economic activities, and such firms disintegrated into divisions coordinated by departmental managers. In the late nineteenth century, big business proliferated since new power sources, including electricity and steam engines, led to the easy operation of factory machinery (Tomizawa et al., 2020). As a result of organized production, there was mass, faster, and more efficient manufacturing of standardized goods. Big business positively impacted entrepreneurs, prompting them to use practical leadership principles, which significantly motivated employees, resulting in increased work performance.
The Rise of Big Business in the Late Nineteenth Century
During the rise of big business, most companies employed many subordinates frequently in the urban regions. Before the period, most Americans were earning their living in agriculture. The institutions began hiring middle managers to coordinate work among organizational divisions. One of the booming factories was the railroads, which operated as public entities and sold shares as stock. To a great extent, ownership became highly detached from management. A large bureaucracy of leaders anticipated efficient and rational operations, while central office managers examined the firms processes and made strategic decisions. In the 1850s, railroad executives began perfecting managerial control systems over their constantly complex industries (Galambos, 2019). The massive expansion of big business resulted in massive production and distribution of commodities. In addition, the big city stores emerged and incorporated multiple retail operations in a single organization under one building. By 1862, the downtown districts of major cities, including New York, had departmental business outlets (Tomizawa et al., 2020). In 1872, mail-order ventures, including Roebuck and Sears, started serving people in small towns and rural areas (Galambos, 2019). Most entrepreneurs utilized vertical and horizontal integration to create a monopoly of their businesses.
In various manufacturing lines, there existed merits to having single companies control fabrication, raw materials supply, distribution, and transportation. For instance, after buying a steel company, Andrew Carnegie became the wealthiest person globally. Carnegies steel entity regulated coal sources, ships, and purchased raw materials, mainly from Pittsburgh. Notably, Carnegies firm produced finished products, such as bridge girders and rails, and a single managerial corporations executives controlled the entire operation. Another industry boomed was meatpacking, where multiple Chicago firms constructed vast, complex entities for buying and butchering animals and distributing meat across the United States (Tomizawa et al., 2020). Other companies thrived as they used slaughtered animal byproducts, such as skin, and processed them into leather goods. At the end of the nineteenth century, John Rockefeller established Standard Oil, which dominated the refinement and supply of petroleum products across America and other bordering countries (Hertel-Fernandez, 2019). Standard Oils management team participated in bribes to state legislators and local politicians to deter new government policies and control other business rivals from engaging in shipping ventures.
The rise of big business threatened many local and small businesses since they could not effectively compete with large enterprises with lower prices, making them bankrupt. However, the increased mass production success in the later nineteenth century resulted in improved marketing strategies to sell items (Tomizawa et al., 2020). Most entities started differentiating themselves by becoming attractive urban chain stores instead of dry-commodities outlets. The influence purchasing decisions and advertisements flooded newspapers substantially increased consumer buying behavior, making companies record high profits (Hertel-Fernandez, 2019). The middle-class culture began mirroring consumerism instead of Victorian character virtues since people had an enhanced social status. Wealthy entrepreneurs, such as Rockefeller and Carnegie, established charity organizations and gave money to museums, universities, medical research centers, and libraries to advance the American civic culture and uplift other peoples well-being. Nevertheless, the upper-class individuals philanthropic acts were not to reform the country but to promote business inequalities.
The progressive reformers, farmers, and small entrepreneurs wanted government officials to regulate the railroad, petroleum, and shipping industries. The administrative reforms commenced with the 1890 Sherman Antitrust Act and the 1887 Interstate Commerce Act, which prohibited railroad business price discrimination and minimized competitive pressures (Galambos, 2019). The Sherman policy banned the integration of considerable commerce and trade corporations in multiple American states to curb monopoly. Nevertheless, the rise of big business significantly reshaped the United States society and economy since many venture reformations merited many Americans and led to greater prosperity.
Factors that Led to the Growth of Government in the Late Nineteenth Century
The emergence and the rise of big business resulted in the establishment of many reformations that spearheaded the growth of government. The increased availability of raw materials, the surge of technological advancement, and the growing labor supply prompted the federal government to assist in the growth and expansion of ventures. Notably, one of the crucial factors that resulted in the governments development was the introduction of libraries, fire forces, professional police, and public schools across various cities, such as Oregon, California, and New York.
The federal, state, county, and municipal government representatives were responsible for regulating the property, market, and communal correlations. In addition, the administrative officials oversaw the transportation and banking systems, leading to the governments growth. In 1849, the interior department was established to protect entrepreneurs businesses and safeguard peoples right to material rights (Hertel-Fernandez, 2019). The monopoly protection acts enabled the administrative officials to impose levies on imported commodities. The federal revenues escalated from $260 million in 1879 to $570 million in 1892, resulting in the growth of the government (Galambos, 2019). Notably, cities began financing school systems and recreational centers, which increased local taxation. The establishment of the treasury department, mandated with the collection of national customs and levies and printing stamps and money, increased its employees from 4,000 in 1874 to approximately 24,000 in 1890 (Hertel-Fernandez, 2019). The escalated workforce and the creation of more administrative agencies resulted in the growth of the government. The salaried holders of party-financed federal jobs were taxed, and the mobilization for business reconstruction reformation enabled the government to expand. Several federal departments new tasks and duties led to the United States governmental development.
Conclusion
Big business was a period where large companies employed many workers, resulting in industrialization and economic policy transformation in the United States. Most organizations used management to regulate different business tasks, and such entities disintegrated into departments coordinated by divisional managers. The administrative reforms commenced with the 1890 Sherman Antitrust Act and the 1887 Interstate Commerce Act, which banned railroad venture price discrimination and reduced competitive pressures. Various factors led to the growth of the government in the late nineteenth century. The increased availability of the workforce and The finance of recreational centers, public schools, and public libraries by the cities resulted in an improvement in revenue collection, which enabled the growth of the government.
References
Galambos, L. (2019). The public image of big business in America, 1880-1940: A quantitative study in social change. John Hopkins University Press.
Hertel-Fernandez, A. (2019). State capture: How conservative activists, big businesses, and wealthy donors reshaped the American states and the nation. Oxford University Press.
Tomizawa, A., Zhao, L., Bassellier, G., & Ahlstrom, D. (2020). Economic growth, innovation, institutions, and great enrichment. Asia Pacific Journal of Management, 37(1), 7-31. Web.
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