John D. Rockefeller's Monopolies

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During the industrial era, business leaders such as Vanderbilt, Carnegie, Rockefeller, and Morgan created monopolies that greatly dictated the direction and state of the United State’s economy. Using varying tactics, these four men were able to conquer different emerging industries. Because business had very little regulation at the time, business leaders had limitless power. The first, main owner of a monopoly was Cornelius Vanderbilt. In the late 1800’s, he dominated the railroad market. The main way that Vanderbilt did this was by first holding key passageways, such as the rail line into New York and a hub of lines through Chicago. By holding these important rails, Vanderbilt could charge rival lines as much as he wished for the use of …show more content…
Rockefeller made his monopoly in a different way from Vanderbilt. In the late 1800’s, Rockefeller saw the emerging oil industry, but he recognized that refining oil was much safer than drilling for oil. Because of this recognition, Rockefeller, created a refining business. By ramping up production and using the nation’s several railroads, Rockefeller gained much of his wealth. With his company’s profits, Rockefeller bought out and shut down nearly all other oil refineries in America. Because Rockefeller did this, he made Standard Oil one of the only refineries in the nation. By using horizontal integration, Rockefeller built a monopoly where all oil companies had to go to him in order to refine their oil. Rockefeller’s system was very successful, and it is likely that without government intervention, Standard Oil’s monopoly would have continued indefinitely. Even with government intervention that forced Standard Oil into several smaller companies, Rockefeller still led the trust that ran these companies. Today, the smaller companies that were once Standard oil are still powers of the industry, including such names as Mobil, Exxon, and ConocoPhillips. With the use of horizontal integration and owning an entire step of the oil industry’s process, Rockefeller created a massive …show more content…
Vanderbilt entered the industry early and held vital rail lines that allowed him to have leverage over the competition. Rockefeller saw the business opportunity of refining oil rather than mining it. Because he saw this opportunity, Rockefeller had a head start on the competition. Along with a head start on the competition, Rockefeller also bought out rival companies, so he formed his company using horizontal integration. Carnegie also had a headstart on the rival companies, but instead of buying out rival companies for an edge, he owned a step in every level of production. Morgan used his wealth to his advantage by buying out industries such as steel and electricity while expanding his banking empire. These four men demonstrate that there were several ways for one to monopolize an industry in this era. Even after the demonopolization of American industries, these men still held trusts that dominated their respective industries. After the Sherman Antitrust Act, their companies were still highly successful and the most powerful in their industry. By using all resources to their advantage, they became the business leaders of their
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