6.4 Technological Innovation

New technologies drive industrial growth

Innovations like the Bessemer process (cheap, mass-produced steel), electricity, and the refinement of oil powered the second Industrial Revolution. Steel enabled skyscrapers, bridges (Brooklyn Bridge), and railroads; Edison's incandescent light bulb and power grids extended the workday and transformed cities and factories.

Corporate innovation and business consolidation

Entrepreneurs like Andrew Carnegie (steel, vertical integration) and John D. Rockefeller (oil, horizontal integration/trusts) built massive corporations using new management techniques. New corporate structures — trusts, holding companies, and monopolies — concentrated economic power, prompting later government regulation efforts like the Sherman Antitrust Act (1890).

Transportation and communication networks

The completion of the transcontinental railroad (1869) and expanding rail networks linked national markets, standardized time zones, and spurred western settlement. The telegraph and later the telephone (Alexander Graham Bell) sped communication, while standardization (interchangeable parts, gauges) made national mass production and distribution possible.

Key terms

Bessemer process

A method for mass-producing cheap, strong steel by removing impurities from molten iron.

Vertical integration

Business strategy (used by Carnegie) of controlling all stages of production, from raw materials to sales.

Horizontal integration

Business strategy (used by Rockefeller) of buying out competitors in the same industry to form a trust/monopoly.

Sherman Antitrust Act (1890)

First federal law aimed at limiting monopolies and trusts to restore market competition.

Transcontinental railroad (1869)

Rail line connecting the East and West coasts, linking national markets and spurring settlement and standardized time zones.

Try an AP-style question

The Bessemer process revolutionized…

1. telegraph lines
2. cotton spinning
3. oil refining
4. steel production