Common ownership refers to holding the assets of an organization,

enterprise Enterprise (or the archaic spelling Enterprize) may refer to: Business and economics Brands and enterprises * Enterprise GP Holdings, an energy holding company * Enterprise plc, a UK civil engineering and maintenance company * Enterpris ...

, or community indivisibly rather than in the names of the individual members or groups of members as common property. Forms of common ownership exist in every

economic system An economic system, or economic order, is a system of production, resource allocation and distribution of goods and services within an economy. It includes the combination of the various institutions, agencies, entities, decision-making proces ...

. Common ownership of the

means of production In political philosophy, the means of production refers to the generally necessary assets and resources that enable a society to engage in production. While the exact resources encompassed in the term may vary, it is widely agreed to include the ...

is a central goal of

socialist Socialism is an economic ideology, economic and political philosophy encompassing diverse Economic system, economic and social systems characterised by social ownership of the means of production, as opposed to private ownership. It describes ...

political movements as it is seen as a necessary democratic mechanism for the creation and continued function of a

communist society In Marxist thought, a communist society or the communist system is the type of society and economic system postulated to emerge from technological advances in the productive forces, representing the ultimate goal of the political ideology of ...

. Advocates make a distinction between

collective ownership Collective ownership is the ownership of private property by all members of a group. The breadth or narrowness of the group can range from a whole society to a set of coworkers in a particular enterprise (such as one collective farm). In the la ...

and common property (the

commons The commons is the cultural and natural resources accessible to all members of a society, including natural materials such as air, water, and a habitable Earth. These resources are held in common even when owned privately or publicly. Commons ...

) as the former refers to property owned jointly by agreement of a set of colleagues, such as producer

cooperative A cooperative (also known as co-operative, coöperative, co-op, or coop) is "an autonomy, autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned a ...

s, whereas the latter refers to assets that are completely open for access, such as a public park freely available to everyone.

Christian societies

The

Early Church of Jerusalem The Early Church of Jerusalem is considered to be the first community of early Christianity. It was formed in Jerusalem after the crucifixion of Jesus. It proclaimed to Jews and non-Jews the resurrection of Jesus Christ, the forgiveness of sins ...

shared all their money and possessions (Acts of the Apostles 2 and 4). Inspired by the

early Christians Early Christianity, otherwise called the Early Church or Paleo-Christianity, describes the historical era of the Christian religion up to the First Council of Nicaea in 325. Christianity spread from the Levant, across the Roman Empire, and bey ...

, many Christians have since tried to follow their example of

community of goods Common ownership refers to holding the assets of an organization, Business, enterprise, or community indivisibly rather than in the names of the individual members or groups of members as common property. Forms of common ownership exist in ever ...

and common ownership. Common ownership is practiced by some Christian groups, such as the

Hutterites Hutterites (; ), also called Hutterian Brethren (German: ), are a communal ethnoreligious group, ethnoreligious branch of Anabaptism, Anabaptists, who, like the Amish and Mennonites, trace their roots to the Radical Reformation of the early 16 ...

(for about 500 years), the

Bruderhof Communities The Bruderhof (; German for 'place of brothers') is a communal Anabaptist Christian movement that was founded in Germany in 1920 by Eberhard Arnold. The movement has communities in the United States, the United Kingdom, Germany, Austria, Paragu ...

(for some 100 years), and others. In those cases, property is generally owned by a charity set up for the purpose of maintaining the members of the religious groups. Christian communists typically regard biblical texts in Acts 2 and

Acts 4 Acts 4 is the fourth chapter of the Acts of the Apostles in the New Testament of the Christian Bible. The book containing this chapter is anonymous but early Christian tradition affirmed that Luke composed this book as well as the Gospel of Luke ...

as evidence that the first Christians lived in a

. Additionally, the phrase " To each according to his needs" has a biblical basis in Acts 4:35, which says "to the emissaries to distribute to each according to his need".

In capitalist economies

Common ownership is practiced by large numbers of voluntary associations and non-profit organizations, as well as implicitly by all public bodies. While cooperatives generally align with collectivist and socialist economics,

retailers' cooperatives A retailers' cooperative is a type of cooperative which employs economies of scale on behalf of its Retailing, retailer members. Retailers' cooperatives use their purchasing power to acquire discounts from manufacturers and often share marketing e ...

in particular exhibit elements of common ownership, and their retailer members may be individually owned. Some individuals and organizations intentionally produce or support

free content Free content, libre content, libre information, or free information is any kind of creative work, such as a work of art, a book, a software program, or any other creative content for which there are very minimal copyright and other legal limi ...

, including

open source Open source is source code that is made freely available for possible modification and redistribution. Products include permission to use and view the source code, design documents, or content of the product. The open source model is a decentrali ...

software,

public domain The public domain (PD) consists of all the creative work to which no Exclusive exclusive intellectual property rights apply. Those rights may have expired, been forfeited, expressly Waiver, waived, or may be inapplicable. Because no one holds ...

works, and

fair use Fair use is a Legal doctrine, doctrine in United States law that permits limited use of copyrighted material without having to first acquire permission from the copyright holder. Fair use is one of the limitations to copyright intended to bal ...

media.

Mutual aid Mutual aid is an organizational model where voluntary, collaborative exchanges of resources and services for common benefit take place amongst community members to overcome social, economic, and political barriers to meeting common needs. This ...

is a form of common ownership that is practiced on small scales within capitalist economies, particularly among marginalized communities, and during emergencies such as the

COVID-19 pandemic The COVID-19 pandemic (also known as the coronavirus pandemic and COVID pandemic), caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), began with an disease outbreak, outbreak of COVID-19 in Wuhan, China, in December ...

In socialist economies

Many socialist movements, including

Marxist Marxism is a political philosophy and method of socioeconomic analysis. It uses a dialectical and materialist interpretation of historical development, better known as historical materialism, to analyse class relations, social conflic ...

anarchist Anarchism is a political philosophy and Political movement, movement that seeks to abolish all institutions that perpetuate authority, coercion, or Social hierarchy, hierarchy, primarily targeting the state (polity), state and capitalism. A ...

reformist Reformism is a political tendency advocating the reform of an existing system or institution – often a political or religious establishment – as opposed to its abolition and replacement via revolution. Within the socialist movement, ref ...

, and communalist movements, advocate the common ownership of the means of production by all of society as an eventual goal to be achieved through the development of the

productive forces Productive forces, productive powers, or forces of production ( German: ''Produktivkräfte'') is a central idea in Marxism and historical materialism. In Karl Marx and Friedrich Engels' own critique of political economy, it refers to the combin ...

, although many socialists classify socialism as

public ownership State ownership, also called public ownership or government ownership, is the ownership of an industry, asset, property, or enterprise by the national government of a country or state, or a public body representing a community, as opposed t ...

cooperative ownership A cooperative (also known as co-operative, coöperative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democr ...

of the means of production, reserving common ownership for what

Karl Marx Karl Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, political theorist, economist, journalist, and revolutionary socialist. He is best-known for the 1848 pamphlet '' The Communist Manifesto'' (written with Friedrich Engels) ...

and

Friedrich Engels Friedrich Engels ( ;"Engels"
''Random House Webster's Unabridged Dictionary''.upper-stage communism", or what other socialist theoreticians, such as

Vladimir Lenin Vladimir Ilyich Ulyanov ( 187021 January 1924), better known as Vladimir Lenin, was a Russian revolutionary, politician and political theorist. He was the first head of government of Soviet Russia from 1917 until Death and state funeral of ...

Emma Goldman Emma Goldman (June 27, 1869 – May 14, 1940) was a Russian-born Anarchism, anarchist revolutionary, political activist, and writer. She played a pivotal role in the development of anarchist political philosophy in North America and Europ ...

, and

Peter Kropotkin Pyotr Alexeyevich Kropotkin (9 December 1842 – 8 February 1921) was a Russian anarchist and geographer known as a proponent of anarchist communism. Born into an aristocratic land-owning family, Kropotkin attended the Page Corps and later s ...

, simply termed "communism". From Marxist and anarchist analyses, a society based on a superabundance of goods and common ownership of the means of production would be devoid of classes based on ownership of productive property. Common ownership in a hypothetical

is often distinguished from

primitive communism Primitive communism is a way of describing the gift economies of hunter-gatherers throughout history, where resources and property hunted or gathered are shared with all members of a group in accordance with individual needs. In political sociolo ...

, in that communist common ownership is the outcome of social and technological developments leading to

post-scarcity Post-scarcity is a theoretical economic situation in which most goods can be produced in great abundance with minimal human labor, so that they become available to all very cheaply or even freely. Post-scarcity does not mean that scarcity ...

and thus the elimination of material scarcity in society. From 1918 until 1995, the "common ownership of the means of production, distribution and exchange" was cited in Clause IV of its constitution as a goal of the British Labour Party and was quoted on the back of its membership cards. The clause read:

To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service.

Antitrust economics

antitrust Competition law is the field of law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. It is also known as antitrust l ...

economics, common ownership describes a situation in which large

investors An investor is a person who allocates financial capital with the expectation of a future return (profit) or to gain an advantage (interest). Through this allocated capital the investor usually purchases some species of property. Types of in ...

own

shares In financial markets, a share (sometimes referred to as stock or equity) is a unit of equity ownership in the capital stock of a corporation. It can refer to units of mutual funds, limited partnerships, and real estate investment trusts. Sha ...

in several firms that compete within the same

industry Industry may refer to: Economics * Industry (economics), a generally categorized branch of economic activity * Industry (manufacturing), a specific branch of economic activity, typically in factories with machinery * The wider industrial sector ...

. As a result of this overlapping ownership, these firms may have reduced incentives to compete against each other because they internalize the profit-reducing effect that their competitive actions have on each other. The theory was first developed by Julio Rotemberg in 1984.

/ref> Several empirical contributions document the growing importance of common ownership and provide evidence to support the theory. Because of concern about these anticompetitive effects, common ownership has "stimulated a major rethinking of antitrust enforcement".. Several government departments and intergovernmental organizations, such as the

United States Department of Justice The United States Department of Justice (DOJ), also known as the Justice Department, is a United States federal executive departments, federal executive department of the U.S. government that oversees the domestic enforcement of Law of the Unite ...

,

/ref> the

Federal Trade Commission The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) United States antitrust law, antitrust law and the promotion of consumer protection. It ...

,

/ref> the

European Commission The European Commission (EC) is the primary Executive (government), executive arm of the European Union (EU). It operates as a cabinet government, with a number of European Commissioner, members of the Commission (directorial system, informall ...

,

/ref> and the

OECD The Organisation for Economic Co-operation and Development (OECD; , OCDE) is an international organization, intergovernmental organization with 38 member countries, founded in 1961 to stimulate economic progress and international trade, wor ...

,

/ref> have acknowledged concerns about the effects of common ownership on lessening product

market competition In economics, competition is a scenario where different Economic agent, economic firmsThis article follows the general economic convention of referring to all actors as firms; examples in include individuals and brands or divisions within the s ...

Contract theory

Neoclassical economic theory analyzes common ownership using

contract theory From a legal point of view, a contract is an institutional arrangement for the way in which resources flow, which defines the various relationships between the parties to a transaction or limits the rights and obligations of the parties. From an ...

. According to the incomplete contracting approach pioneered by Oliver Hart and his co-authors, ownership matters because the owner of an asset has residual control rights. This means that the owner can decide what to do with the asset in every contingency not covered by a contract. In particular, an owner has stronger incentives to make relationship-specific investments than a non-owner, so ownership can ameliorate the

hold-up problem In economics, the hold-up problem is central to the theory of incomplete contracts, and shows the difficulty in writing complete contracts. A hold-up problem arises when two factors are present: # Parties to a future transaction must make non ...

. As a result, ownership is a scarce resource (i.e. there are limits to how much they can invest) that should not be wasted. In particular, a central result of the property rights approach says that joint ownership is suboptimal. If there is a start with joint ownership (where each party has veto power over the use of the asset) and move to a situation in which there is a single owner, the investment incentives of the new owner are improved while the investment incentives of the other parties remain the same; however, in the basic incomplete contracting framework, the suboptimal aspect of joint ownership holds only if the investments are in

human capital Human capital or human assets is a concept used by economists to designate personal attributes considered useful in the production process. It encompasses employee knowledge, skills, know-how, good health, and education. Human capital has a subs ...

while joint ownership can be optimal if the investments are in physical capital. Several authors have shown that joint ownership can actually be optimal even if investments are in human capital. In particular, joint ownership can be optimal if the parties are asymmetrically informed, if there is a long-term relationship between the parties, or if the parties have know-how that they may disclose.

References

External links

*
The Co-operative Advantage - Creating a successful family of Co-operative businesses. The Report of the Co-operative Commission January 2001
'. The Co-operative Commission was established by British prime minister

Tony Blair Sir Anthony Charles Lynton Blair (born 6 May 1953) is a British politician who served as Prime Minister of the United Kingdom from 1997 to 2007 and Leader of the Labour Party (UK), Leader of the Labour Party from 1994 to 2007. He was Leader ...

in 2000 and recommended that ''A modernizing bill should be put before Parliament to recognize in law the Co-operative form of common ownership.'' (recommendation 51). * Frank H. Stephen (1984) ''The Economic Analysis of Producers' Cooperatives'' London:Macmillan, , p. 145 {{Authority control Economic systems Anarchist theory Socialism Property