Jason Lee
Mrs Schaffer
Econ
2012/10/25
John D. Rockefeller's Standard Oil Company
John Davison Rockefeller (July 8, 1839 – May 23, 1937) once was called the richest man in history, achieve his height by establish a monopoly on standard oil. Rockefeller formed his company Standard Oil of Ohio in 1870, which at that time made lots of profits as car was just getting popular. It soon became the most profitable refiners in the US. Rockefeller gradually takes control of 90% of oil refinery by horizontal integration, then through vertical system Rockefeller controls every aspect of oil from production. Therefor granting him the monopoly in the oil industry. Standard’s most potent weapons against competitors were underselling, differential pricing, and secret transportation rebates.These successfully denies entry of other competitors but also earn a bad reputation for the Standard Oil company. Rockefeller worked hard through his life to achieve to his heights. His intelligence in economics is just one of many reasons he was successful in the Standard Oil monopoly. In 1890 the Sherman anti trust act was created to broke up union but later focused on breaking Standard oil. Which lead to Ohio separated from the Company. The Standard oil company was not seriously affect by it, they are still making maximum interest. Until 1911 the supreme court of the united states found Standard oil company violated the Sherman anti trust act and thus ordered to be broken up into 34 separate company. Rockefeller, 72 years old still hold 25% of the company stock. When the company split, he sold his stocks and receive portions of shares from the 34 company. In the end, Rockefeller gained about 900,000,000 dollars.
Sources: http://en.wikipedia.org/wiki/John_D._Rockefeller
http://www.spartacus.schoolnet.co.uk/USArockefeller.htm
Sources: http://en.wikipedia.org/wiki/John_D._Rockefeller
http://www.spartacus.schoolnet.co.uk/USArockefeller.htm
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