But in Scale and Scope the essential thesis is that between the 1850s and the 1880s the transportation and communications networks established the technological and organizational base for the exploitation f economies f scale and scope in the processes f production and distribution. (p. 58)
The entrepreneurial response in distribution preceded that in production because innovation in distribution was primarily organizational, not technological. The reasons for the decline f commission agents and the growth f full line, full service wholesalers and mass retailers is not entirely clear from Chandler's analysis. Many f the names f the mass retailers that emerged after the Civil War are still familiar today and include Macy's, Lord & Taylor, Strawbridge & Clothier, John Wanamaker, Marshall Field, and Emporium. Montgomery Ward and Sears Roebuck came to dominate the rural market, relying heavily on mail-order operations. These houses built administrative systems to handle more transactions in a day than most traditional merchants could handle in a lifetime.
The laying down f railroad and telegraph systems precipitated a wave f industrial innovation in Western Europe and the United States far more wide ranging than that which had occurred in Britain at the end f the eighteenth century. This wave has been properly termed by historians the Second Industrial Revolution. . . (p. 62) and involved systemic innovations in oil refining, steel, machinery, glass, artificial dyes, fibres, fertilizers, and food processing. But for the potential f these innovations to be realized, entrepreneurs had to make the three pronged investment. 
In industries where only one or two pioneering enterprises made the three pronged investment, these enterprises quickly dominated the market. More ften, however, the modern industrial enterprise in the United States appeared after merger or acquisition (p. 71). This in turn was ften preceded by efforts to manage capacity utilization by fixing prices and output. Cartel agreements in the United States were, however, extremely unstable because, as in Britain, contractual agreements in restraint f trade could not be enforced in courts f law. Moreover, after 1890 and the passage f the Sherman Act made what was previously unenforceable quite illegal. The Sherman Act "was to have a profound impact on the evolution f modern industrial enterprises in the U.S." (p. 72). Shortly after its passage and subsequent amplification by a number f Supreme Court decisions, there began the largest and certainly most significant merger movement in American history. It came partly because f continuing antitrust legislation and activities by the states, partly because f the increasing difficulty f enforcing contractural agreements by trade associations during the depression f the mid-1890s, and partly because the return f prosperity and the