The Business of Railroads Industrial Empires: Steel Industry; vertical integration (WXT) (dec 1, 1895 – dec 1, 1911)

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Given all the major innovations prior to the Civil War period and the leadership of many politicians in improving infrastructure in the United States, the nation’s first large business was founded in railroads. After the Civil War, railroads covered a large part of America’s landscape, covering 35 thousand miles in 1865 to 193,000 miles in the 1900s. Railroads were an essential part in cutting the distance barrier in areas in markets and providing a large push in industry and the economy. The railroad encouraged mass production, mass consumption and economic specialization in the United States, entirely changing the interpretation people held on the economy and consumption of goods. Not only did railroads cut time restraints inside the United States, they entirely changed how business ran. Furthermore the steel industry was booming especially with the new process created by Henry Bessemer which allowed for a faster and larger production of steel. Andrew Carnegie, worked himself up from poverty and established a large production line of steel. One of the ways he maintained this tycoon of steel was through vertical integration where all the stages of the industrial process would be controlled by one company. This included mining, processing, and the transportation of the goods. His strategy was extravagantly efficient, that by 1900, Carnegie surpassed British steel production. Towards the later stages of his life, Carnegie would sell off his company to J.P. Morgan for 400 million dollars.

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