The Second Industrial Revolution: Energy, Transport, and Industry

New Sources of Energy (1844–1914)

The period between 1844 and 1914 was defined by the rise of oil and electricity. Electricity offered easy conversion into light, heat, and movement; with the invention of the transformer, it could be transmitted to distant locations. This changed the geography of businesses and organizations while driving down energy costs. It had numerous applications in communications, transportation, lighting, and leisure.

Oil production began in the United States in 1859, initially used for illumination, lubricants, and heating. However, its most significant application became fuel for transport in cars, boats, and aircraft.

The New Means of Transport

During the mid-19th century, major railway networks were built across Europe. Electricity enabled urban transport, such as trams and metropolitan railways. In shipbuilding, the increased use of steel and improved power shortened travel durations, encouraging large-scale European migrations. Additionally, the opening of new canals, such as the Suez and Panama, stimulated maritime trade.

The automobile resulted from the combination of the internal combustion engine, the pneumatic tire, and the use of oil as fuel. Mass production began in France and the United States around 1900. Furthermore, the first airplane flight was achieved by the Wright brothers in 1903.

The New Organization of Capital and Labor

Business Concentration

The large investments required for industrial growth were beyond the reach of small family businesses, leading to a process of business concentration. Through mergers, acquisitions, and agreements, corporate giants emerged to control the market:

• Horizontal concentration: Companies operating in the same sector.
• Vertical concentration: Companies engaged in complementary activities.
• Cartel: An association of undertakings to eliminate competition.
• Trust: The merger of several companies.
• Holding company: A financial entity that holds capital in diverse and varied enterprises.
• Monopoly: A manufacturer or distributor that holds exclusive rights to a product and dictates prices.

Mass Production

New forms of work organization significantly improved productivity. In the United States, Taylorism and Fordism helped increase output and reduce costs, eventually spreading globally.

• Taylorism: Eliminates unnecessary worker movements and optimizes time to reduce costs.
• Fordism: Organized production through an assembly line. The continuous movement of the conveyor belt sets the pace of production, prevents time loss, and synthesizes actions.

Henry Ford adapted the assembly line to automobile production using innovative machinery and skilled workers paid higher wages. By manufacturing simple, inexpensive cars intended for the average American family, Ford introduced the era of mass consumption.