June 2013 1-02: How important was big business in the growth of the US economy in the years 1890 to 1919? (24 marks)

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June 2013 1-02: How important was big business in the growth of the US economy in the years 1890 to 1919? (24 marks)

Advantages

  • The creation of corporations and monolithic business organisations enabled the US economy to expand efficiently
  • Oil was a primary factor in industrial development as a source of energy.  Its production and distribution was controlled by big business interests such as those dominated by Rockefeller. The same was true of the steel industry
  • the banking sector was vital to economic growth.  It was controlled through big business interests
  • big business remained massively influential in spite of restrictions such as the Sherman Anti-Trust Laws.

Disadvantages

  • the rapid rise in the number of immigrants coming to the USA meant that cheap labour was readily available
  • Improved agricultural production methods were developed which made the USA a major provider of cheap food
  • the impact of the First World War. From 1914 the USA became a major source of finance for Britain and France and it produced munitions.
  • new technology provided the basis for economic growth. The USA was a leader in developing modern technology
  • advertising was developed in order to reach a wider domestic market.

Evaluation

Refer to mass production methods, such as Taylorism from 1915. Big business was pivotal in the economic growth of the USA but it was dependent upon a range of other supporting conditions.  Collectively these combined factors enabled the USA to experience rapid economic expansion.

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