Question

What factors led to the rise of the corporation after 1865? What means did corporate leaders use to expand their control of markets?

Answer 1

The rise of corporations after 1865 was due to technological advancements, capital accrual, and the growth of national markets. Corporate leaders expanded their market control through strategies like vertical and horizontal integration, as well as forming trusts. Concerns over corporate power led to calls for more government regulation.

Step-by-step explanation:

Factors Leading to the Rise of the Corporation After 1865

The rise of the corporation after 1865 can be credited to several key factors, including technological advancements, the availability of capital, and the growth of national markets facilitated by the expansion of the railroad. Innovations such as the telephone and the electric light bulb transformed industries and provided the infrastructure for large-scale enterprises. The period saw capitalists like Andrew Carnegie and John D. Rockefeller amassing wealth that allowed them to incorporate and oftentimes monopolize entire industries.

Expansion of Corporate Control over Markets

To expand their control, corporate leaders deployed various strategies including vertical and horizontal integration, buying out competitors, and sometimes forming trusts and holding companies. This consolidation allowed companies to control the market for their products and reduce competition, thereby increasing profits. Moreover, the federal government's willingness to permit this growth, as well as the general public's acceptance of capitalism (albeit with increasing calls for regulation), facilitated the expansion of corporations and their dominion over the economy.

The formidable power that corporations acquired during this time changed the American landscape, not just economically but also politically and socially, by shaping federal regulation and labor relations. However, this led to a growing concern among reformers who pushed for government intervention to prevent the creation of oligarchies. Thus, over time, a more robust government role in regulating corporations and protecting public interests gained traction.

Answer 2

In the early nineteenth century, the corporate form of business organization had been used to raise large amounts of start-up capital for transportation enterprises such as turnpikes and canals. By selling stocks and bonds to raise money, the corporation separated the company’s managers, who guided its day-to-day operation, from the owners—those who had purchased the stocks and bonds as investments.

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