This paper uses the Great Merger Wave (GMW) of 1895-1904 as a quasi-experiment to identify the causal effect of “Big Business” (large, market-dominant corporations) on American innovation between 1880 and 1940. Using newly constructed data, I show that firms that consolidated during the GMW significantly increased patenting and breakthrough innovations. Among firms that were already innovating before the GMW, consolidation led to an increase of 6 patents and 0.6 breakthroughs per year—a roughly four-fold and six-fold increase, respectively. Firms with no prior patents were more likely to begin innovating. The establishment of corporate R&D laboratories serves as the key mechanism linking increased firm size and market dominance to these innovation gains. Using a matched inventor-firm panel to separate inventor ability from firm productivity, I show that the laboratory premium cannot be explained by labs attracting better inventors. Instead, the evidence suggests that laboratories granted a genuine organizational advantage and drove firm-level innovation gains. To assess whether these firm-level effects translated into broader technological progress, I examine total patenting within entire technological domains. In technological domains where GMW firms had previously been active, breakthrough innovation accelerated for science-based fields but was delayed in non-science-based areas. Overall, I estimate that one in ten breakthroughs between 1905 and 1940 were attributable to the GMW.