History and Theory of Cooperatives
University of Newcastle; Victoria University of Wellington - School of Economics & Finance
INTERNATIONAL ENCYCLOPEDIA OF CIVIL SOCIETY, Helmut Anheier, Stefan Toepler, eds., Springer, 2009
Cooperatives have evolved significantly over the last 200 years and are of increasing importance to economies throughout the world. Yet, cooperatives are marginalised and treated as inefficient and ineffective organisational types. This paper discusses the significance of cooperatives over historical time and the extent to which they are both efficient and effective economically and socially. Alternative theory is used to provide insight into the cooperative advantage in different economic sectors, and shows that cooperative solutions can produce higher socioeconomic welfare levels to members whilst also overcoming significant market failures. Also, competitive market places and cooperatives are not incompatible as market forces cannot force non-cooperative solutions to socioeconomic problems. Cooperatives show that democratic governance within the firm can contribute significantly to socioeconomic well-being.
Keywords: Cooperatives, Inefficiency, Organisational types, History, Market failures, Welfare, Socioeconomics
JEL Classification: P13, J54
Date posted: January 26, 2010