Cooperative (or co-operative) economics is a field of

economics Economics () is the social science that studies the production, distribution, and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analy ...

that incorporates cooperative studies and

political economy Political economy is the study of how economic systems (e.g. markets and national economies) and political systems (e.g. law, institutions, government) are linked. Widely studied phenomena within the discipline are systems such as labour ...

toward the study and management of

cooperatives A cooperative (also known as co-operative, 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 democratically-control ...

History

Cooperative economics developed as both a theory and a concrete alternative to industrial capitalism in the late 1700s and early 1800s. As such, it was a form of stateless socialism. The term "socialism," in fact, was coined in ''The Cooperative Magazine'' in 1827''.'' Such socialisms arose in response to the negative effects of industrialism, where various clergyman, workers, and industrialists in England, such as Robert Owen, experimented with various models of collective farming and community housing with varying degrees of success. This movement was often integrated with other progressive movements of the era such as women's suffrage and abolitionism.

"British industrialist Robert Owen (1771–1858) founded a model factory town around his cotton mill and later established a model socialist community, New Harmony, in Indiana. Some proponents of women's rights, such as Emma Martin (1812–1851) in Britain and Flora Tristan (1801–1844) in France, stirred controversy by promoting socialism as the solution to female oppression."

While state socialism was growing popular, rising in the early 1900s, followed by collapse in the 20th century, the cooperative movement grew exponentially in all countries affected by socialism and British colonialism, such as Canada, the U.S., South Africa, and across Europe. Jessica-Gordon Nembhard has produced one of the most thorough academic monographs on cooperative economics entitled ''Collective Courage: A History of African American Cooperative Economic Thought and Practice,'' which looks at how African American communities organized to survive white nationalism, capitalism, and colonialism in the 20th century. The International Cooperative Alliance (ICA) was formed in 1895 and National Cooperative Business Association founded in 1916. The post-WWII era experienced a decline in interest towards cooperatives in the economics profession, with much lower quality and quantity of the discussion on cooperatives in economics text books published after the war compared to those published before the war.
The University of Wisconsin Center for Cooperatives
was founded in 1962, which was possibly the first organization to collect data on cooperatives. In 2000, the Democracy Collaborative was created out of the University of Maryland, which (among other things) facilitates the creation and development of cooperatives. In 2004 the United States Federation of Worker Cooperatives (USFWC) was founded, which, like the ICA, facilitates worker cooperatives (see "Types and Structures of Cooperatives" below). The ongoing success of cooperative economics in providing more effective alternatives to capitalist firms was so significant by the 21st century that the United Nations Assembly

"...declared 2012 as the International Year of Cooperatives, highlighting the contribution of cooperatives to socio-economic development, in particular recognizing their impact on poverty reduction, employment generation and social integration.”

Contemporary cooperative economics has gained even further popularity since 2012, with numerous TED talks dedicated to the subject; they demonstrate how cooperative economics is able to solve problems in housing, food, and poverty that modern industrial countries have so far been unable to solve. In 2013, the USFWC spawned th
Democracy at Work Institute
a sister organization that also facilitates the growth, creation, and conversion of worker cooperatives.

Types and Structures of Cooperatives

General Structures

There are generally four major types of cooperative organizations: #

Consumers' cooperative A consumers' co-operative is an business, enterprise owned by consumers and managed democracy, democratically and that aims at fulfilling the needs and aspirations of its members. Such co-operatives operate within the market economy, market system ...

s, in which the consumers of a co-operative's goods and services are defined as its members (including retail food co-operatives, credit unions, mutual insurance companies, etc.) (Example: REI, federal credit unions, etc.) #

Worker cooperatives A worker cooperative is a cooperative owned and self-managed by its workers. This control may mean a firm where every worker-owner participates in decision-making in a democratic fashion, or it may refer to one in which management is elected by ...

, which are co-owned and democratically co-managed by workers/contributors. (Example: Home-Care Associates, The Driver's Cooperative, Means TV, etc.) # Producer's cooperatives or a suppliers cooperative, which are owned and organized by producers or suppliers, such as farmers (e.g., OceanSpray,

Sunsweet Sunsweet Growers Incorporated is an American agricultural marketing cooperative founded in 1917 as the California Prune and Apricot Growers Association. Sunsweet is headquartered in Yuba City, California, USA. The company operates the largest dr ...

, etc.). The surplus is distributed according to how much goods or services the member has supplied the cooperative. # Purchasing cooperatives, which are owned by organizations that joint-purchase goods or services. The equity structures of cooperatives are therefore various and unlimited. Some implement private/investor equity while others do not. Since the broad purpose of cooperatives is to offer different power structures than ordinary capitalist institutions (which are owned by profit-seekers that may or may not work at the firm), as well as to improve the economic and social life of workers and all who are involved beyond mere profit and creating products/services, there is much internal debate about what is truly "cooperative," "democratic," etc. For example, if a firm is 60% owned by private investors and 40% owned by workers, this would generally not be considered a "worker-cooperative." ESOPs are also not considered cooperatives even if workers own 100% of the firm, because of the usual lack of democratic governance.

Legal Structures

Cooperatives may take on different legal structures depending on jurisdiction, such as an LLC, ESOP, 503c non-profit, or a distinctive cooperative legal structure (if the state provides for one, such a
Massachusetts
. ESOPs (Equity Stock Ownership Plans, where workers own shares for retirement; see, for example, Bob's Redmill) that implement democratic governance are colloquially referred to as "ESOPeratives." In 1996, New Zealand passed th
Cooperative Companies Act
In 2003 the Statute for a European Cooperative Society created a specific legal structure for cooperatives in the EU.

Facts and Figures on Cooperatives

# There are about 3 million cooperatives on the planet. # 12% of global humanity is a member of a cooperative. # 1 in 3 Americans are coop members. # 1.5 million Americans live in a housing cooperative. # Cooperatives electrically power 56% of the United States' landmass and 42 million people. # Coops possess over $1 trillion in assets worldwide and over $640 billion in annual sales. # 92 million Americans turn to 7,500 credit unions (client-owned cooperatives) for financial services; 50,000 American families rely on cooperative day-care facilities. # The Navy Federal Credit Union (founded 1933) is the world's largest credit union with 10.8 million members, 345 branches, and $147.9 billion in assets, serving the men and women of the Armed Forces, Department of Defense, veterans and their families. # The largest worker-cooperative is

Mondragon Corporation The Mondragon Corporation is a corporation and federation of worker cooperatives based in the Basque region of Spain. It was founded in the town of Mondragon in 1956 by José María Arizmendiarrieta and a group of his students at a technical ...

in Spain, which has over 80,000 associates (workers). # The largest cooperative sector by membership is mutual insurance, with over a quarter million members. The most comprehensive data-collection on the largest cooperatives comes from the World Cooperative Monitor.

Distinctives

Cooperatives are different from conventional firms in that the purpose of the firm is not to profit shareholders, but to benefit its members (whether workers, consumers, suppliers or purchasers). Because parts of the cooperative movement were anti-capitalist but not as revolutionary as

Marx Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, economist, historian, sociologist, political theorist, journalist, critic of political economy, and socialist revolutionary. His best-known titles are the 1848 ...

(who aimed to abolish all private property), Marx and Marxists were hesitant about supporting the cooperative movement (especially consumer cooperatives) in the 19th century. The value of consumer vs. worker cooperatives continues to be debated by theorists, activists, and scholars (see below). The International Cooperative Alliance provides seven principles of cooperatives, each that contrasts with capitalist firms: # "Voluntary and Open Membership" (in contrast to coerced/involuntary participation) # "Democratic Member Control" (in contrast to nondemocratic control) # "Member Economic Participation" (in contrast to purely transactional relationships and closed-book management) # "Autonomy and Independence" (in contrast to state-owned or corporate-ownership) # "Education, Training, and Information" (in contrast to " Mushroom management" where workers are "kept in the dark," and information is intentionally funneled through power channels) # "Cooperation among Cooperatives" (in contrast to competition amongst firms) # "Concern for Community" (in contrast to purely product or profit-oriented concerns) An earlier summary of cooperative principles is called the "

Rochdale Principles The Rochdale Principles are a set of ideals for the operation of cooperatives. They were first set out in 1844 by the Rochdale Society of Equitable Pioneers in Rochdale, England and have formed the basis for the principles on which co-operat ...

." Governments may define cooperative enterprises with a simplified version of the above principles. For example, the Australian government defines a cooperative enterprise as follows:

"They serve their members by providing goods and services that may be unavailable or too costly to access as individuals. They share costs and carry on their enterprise under principles of: * non-discrimination * democracy * independence * education and care for communities."

Cooperative economics is also distinct enough from capitalist economics in the public square that it has established and maintains its own domain (

.coop .coop is a sponsored top-level domain (sTLD) in the Domain Name System of the Internet. It is intended for the use of cooperatives, their wholly owned subsidiaries, and other organizations that exist to promote or support cooperatives. The TL ...

Cooperatives, Sustainable Development, and Climate Change

Jeffrey Sachs, an economist who works with the United Nations, has emphasized the centrality of cooperative models of economics for the future survival of our species; though he pays little attention to actual cooperative enterprises and their development as more sustainable and humane models of production, he nevertheless contends more broadly that humans must “forge a new era of cooperation on a global scale" in order to survive.

Elinor Ostrom Elinor Claire "Lin" Ostrom (née Awan; August 7, 1933 – June 12, 2012) was an American political scientist and political economist whose work was associated with New Institutional Economics and the resurgence of political economy. In 2009, she ...

, the first woman to receive the

Nobel Prize The Nobel Prizes ( ; sv, Nobelpriset ; no, Nobelprisen ) are five separate prizes that, according to Alfred Nobel's will of 1895, are awarded to "those who, during the preceding year, have conferred the greatest benefit to humankind." Alfre ...

in economics, demonstrated the ability of cooperative enterprises and organizations to effectively manage environmental goods more than strictly political or market means. Forestry and electricity cooperatives are some of the largest in the world, which puts them in a unique position to address the negative effects of climate change. E. G. Nadeau provides some examples of what this means in his popular introduction to cooperative economics, ''The Cooperative Solution:''

"Dairyland Power Cooperative, based in Wisconsin, has been a national leader in promoting the use of methane gas derived from cow manure as an energy resource. Kauai Island Utility Cooperative, the youngest generation and transmission cooperative in the United States, "is aggressively pursuing diversification of its energy portfolio to include a growing percentage of hydropower, photovoltaic, bio-fuel, and biomass"

Cooperative Economics as an Alternative to Market Societies

Jessica-Gordon Nembhard in her monograph ''Collective Courage'' concludes that:

…cooperatives…use a sense of solidarity and concern for community to promote economic alternatives that create economic growth and sustainability. At the same time, their solidarity and collective action increase productivity and help stabilize their economic circumstances. Moreover, cooperative economics is often viewed as a tool or strategy of a larger movement toward the elimination of economic exploitation and the transition to a new social order.

Relevant Organizations

National and International Cooperative Associations

International Cooperative Alliance

United States Federation of Worker Cooperatives

Canadian Worker Coop Federation

Cooperatives UK

Co-Op Federation (Australia)

National Cooperative Business Association

National Association of Housing Cooperatives
*

National Cooperative Grocers Association National Co+op Grocers (NCG) is a business services cooperative for retail cooperative grocery stores located throughout the United States. NCG offers franchise-like services to food co-ops that help businesses optimize operational and marketing ...

Cooperative Organizations

Democracy at Work

Cooperation Jackson

Grassroots Economic Organizing

Jobs With Justice

Platform Cooperativism Consortium

Purpose

The Institute for Christian Socialism

The Southeast Center for Cooperative Development

The Working World

The New Economy Coalition

Zebras Unite

Cooperative Funding and Finance

Community Wealth
* National Consumer Cooperative Bank * Association of Corporate Credit Unions * Cooperative Finance Corporation * Federal Home Loan Bank System
Community Purchasing Alliance

Capital Impact

Cooperative Development Foundation

Seed Commons

Shared Capital Cooperative

Transform Finance

Major Figures

Notable theoreticians and activists who have contributed to the field include

Robert Owen Robert Owen (; 14 May 1771 – 17 November 1858) was a Welsh textile manufacturer, philanthropist and social reformer, and a founder of utopian socialism and the cooperative movement. He strove to improve factory working conditions, promoted e ...

Pierre-Joseph Proudhon Pierre-Joseph Proudhon (, , ; 15 January 1809, Besançon – 19 January 1865, Paris) was a French socialist,Landauer, Carl; Landauer, Hilde Stein; Valkenier, Elizabeth Kridl (1979) 959 "The Three Anticapitalistic Movements". ''European So ...

Charles Gide Charles Gide (; 1847–1932) was a French economist and historian of economic thought. He was a professor at the University of Bordeaux, at Montpellier, at Université de Paris and finally at Collège de France. His nephew was the author André ...

, Beatrice and Sydney Webb, J.T.W. Mitchell,

Peter Kropotkin Pyotr Alexeyevich Kropotkin (; russian: link=no, Пётр Алексе́евич Кропо́ткин ; 9 December 1842 – 8 February 1921) was a Russian anarchist, socialist, revolutionary, historian, scientist, philosopher, and activ ...

Paul Lambert Paul Lambert (born 7 August 1969) is a Scottish professional football manager and former player, who was most recently the manager of Ipswich Town. Lambert played as a midfielder and won the Scottish Cup in 1987 with St Mirren as a 17-year- ...

Race Mathews Charles Race Thorson Mathews (born 27 March 1935
) is an Australian David Griffiths, and G.D.H. Cole. Additional theorists include John Stuart Mill,

Laurence Gronlund Laurence Gronlund (, Available 1844–1899) was a Danish-born American lawyer, writer, lecturer, and political activist. Gronlund is best remembered for his pioneering work in adapting the International Socialism of Karl Marx and Ferdinand Las ...

Leland Stanford Amasa Leland Stanford (March 9, 1824June 21, 1893) was an American industrialist and politician. A member of the Republican Party, he served as the 8th governor of California from 1862 to 1863 and represented California in the United States Sen ...

, and modern theoretical work by

, Benjamin Ward,

Jaroslav Vanek Jaroslav (also written as Yaroslav or Jarosław in other Slavic languages) is a Czech and Slovak first name, pagan in origin. There are several possible origins of the name Jaroslav. It is very likely that originally the two elements of the nam ...

, David Ellerman, and Anna Milford and Roger McCain. Additional modern thinkers include Nathan Schneider, John Restakis,

Joyce Rothschild Joyce may refer to: People * Joyce (name), list of people and fictional characters with the given name or surname * Joyce, (born 1948), Brazilian singer-songwriter * James Joyce (1882–1941), Irish modernist writer Places * Joyce, Washington, an ...

, Joerg Rieger, Rosemarie Henkel-Rieger,

Jessica Gordon Nembhard Jessica Gordon Nembhard (born July 3, 1956) is an American political economist. She has published books and articles in major economics journals. She is currently Professor of Community Justice and Social Economic Development in the Department of ...

, Corey Rosen et al.,

William Foote Whyte William Foote Whyte (June 27, 1914 – July 16, 2000) was an American sociologist chiefly known for his ethnographic study in urban sociology, ''Street Corner Society''. A pioneer in participant observation, he lived for four years in an Itali ...

Gar Alperovitz Gar Alperovitz (born May 5, 1936) is an American historian and political economist. Alperovitz served as a fellow of King's College, Cambridge; a founding fellow of the Harvard Institute of Politics; a founding Fellow at the Institute for Po ...

Seymour Melman Seymour Melman (December 30, 1917 – December 16, 2004) was an American professor emeritus of industrial engineering and operations research at Columbia University's Fu Foundation School of Engineering and Applied Science. He wrote extensively ...

Mario Bunge Mario Augusto Bunge (; ; September 21, 1919 – February 24, 2020) was an Argentine-Canadian philosopher and physicist. His philosophical writings combined scientific realism, systemism, materialism, emergentism, and other principles. He was ...

Richard D. Wolff Richard David Wolff (born April 1, 1942) is an American Marxian economist known for his work on economic methodology and class analysis. He is professor emeritus of economics at the University of Massachusetts Amherst and a visiting professor ...

and David Schweickart. In Europe, important contributions came from England and Italy, especially from Will Bartlett, Virginie Perotin, Bruno Jossa, Stefano Zamagni, Carlo Borzaga, Jacques Defourny and Tom Winters.

Co-operative federalism versus co-operative individualism

A major historical debate in co-operative economics has been between

co-operative federalism Cooperative federalism is a school of thought in the field of cooperative economics. Historically, its proponents have included J.T.W. Mitchell, Charles Gide, Paul Lambert, and Beatrice Webb (who coined the term in her book ''The Co-operative Mo ...

and co-operative individualism. In an Owenite village of cooperation or a commune, the residents would be both the producers and consumers of its products. However, for co-operative enterprise other than communes, the producers and consumers of its products are two different groups of people, and usually only one of these groups is given the status of members (or co-owners). The differences in goals, purpose, and power between worker and consumer cooperatives has led to a debate between those who support consumer co-operatives (known as the Co-operative Federalists) and those who favor worker co-operatives (pejoratively labelled ‘Individualist' co-operativists by the Federalists ).

Co-operative federalism

Co-operative Federalism is the school of thought favouring consumer co-operative societies. Historically, its proponents have included JTW Mitchell and

, as well as

and

Beatrice Webb Martha Beatrice Webb, Baroness Passfield, (née Potter; 22 January 1858 – 30 April 1943) was an English sociologist, economist, socialist, labour historian and social reformer. It was Webb who coined the term '' collective bargaining''. She ...

. The co-operative federalists argue that consumers should form co-operative wholesale societies ( Co-operative Federations in which all members are co-operators, the best historical example of which being CWS in the

United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the European mainland, continental mainland. It comprises England, Scotlan ...

), and that these co-operative wholesale societies should undertake purchasing farms or factories. They argue that profits (or surpluses) from these co-operative wholesale societies should be paid as

dividends A dividend is a distribution of profits by a corporation to its shareholders. When a corporation earns a profit or surplus, it is able to pay a portion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-i ...

to the member co-operators, rather than to their workers.This analysis is based on a discussion by Gide, Charles, pp. 192–203.

Co-operative Individualism

Co-operative Individualism is the school of thought favouring workers' co-operatives. The most notable proponents of workers' co-operatives are, in Britain, the

Christian Socialists Christian socialism is a religious and political philosophy that blends Christianity and socialism, endorsing left-wing politics and socialist economics on the basis of the Bible and the teachings of Jesus. Many Christian socialists believe cap ...

, and later writers like Joseph Reeves who put this forth as a path to

State Socialism State socialism is a political and economic ideology within the socialist movement that advocates state ownership of the means of production. This is intended either as a temporary measure, or as a characteristic of socialism in the transition ...

. Where the Co-operative Federalists argue for federations in which consumer co-operators federate and receive the monetary

dividend A dividend is a distribution of profits by a corporation to its shareholders. When a corporation earns a profit or surplus, it is able to pay a portion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-inv ...

s, rather, in co-operative wholesale societies the profits (or surpluses) would be paid as dividends to their workers. The Mondragón Co-operatives in Spain are commonly cited by Co-operative Individualists and a lot of Co-operative Individualist literature deals with these societies. The Mondragón Cooperative Corporation has drawn so much attention because in 2010 it was the seventh-largest company in Spain. It consists of about 250 different worker cooperative businesses. The business model they use includes "extensive integration and solidarity with employees", worker involvement in policy and committees, a "transparent" wage system, and "full practice of democratic control". These two schools of thought are not necessarily in opposition, and hybrids of the two positions are possible. James Warbasse's work, and more recently Johnston Birchall's, provide perspectives on the breadth of co-operative development nationally and internationally. Benjamin Ward provided a formal treatment to begin an evaluation of "market syndicalism." Jaroslav Vanek wrote a comprehensive work in an attempt to address cooperativism in economic terms and a "labor-managed economy." David Ellerman began by considering legal philosophic aspects of co-operatives, developing the "labor theory of property." In 2007 he used the classical economic premise in formulating his argument deconstructing the myth of capital rights to ownership. Anna Milford has constructed a detailed theoretical examination of co-operatives in controlled buyer markets (monopsony), and the implications for Fair Trade strategies.

Other schools

Socialism and anarchism

Socialists Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the e ...

and

anarchists Anarchism is a political philosophy and movement that is skeptical of all justifications for authority and seeks to abolish the institutions it claims maintain unnecessary coercion and hierarchy, typically including, though not necessa ...

, such as

anarcho-communists Anarcho-communism, also known as anarchist communism, (or, colloquially, ''ancom'' or ''ancomm'') is a political philosophy and anarchist school of thought that advocates communism. It calls for the abolition of private property but retains re ...

and

anarcho-syndicalists Anarcho-syndicalism is a political philosophy and anarchist school of thought that views revolutionary industrial unionism or syndicalism as a method for workers in capitalist society to gain control of an economy and thus control influence ...

, view society as one big cooperative, and feel that goods produced by all should be distributed equitably to all members of the society, not necessarily through a market. All the members of a society are considered to be both producers and consumers.

State socialists State socialism is a political and economic ideology within the socialist movement that advocates state ownership of the means of production. This is intended either as a temporary measure, or as a characteristic of socialism in the transition fr ...

tend to favor government administration of the economy, while anarchists and

libertarian socialists Libertarian socialism, also known by various other names, is a left-wing,Diemer, Ulli (1997)"What Is Libertarian Socialism?" The Anarchist Library. Retrieved 4 August 2019. anti-authoritarian, anti-statist and libertarianLong, Roderick T. (201 ...

favor non-governmental coordination, either locally, or through labor unions and

worker cooperative A worker cooperative is a cooperative owned and self-managed by its workers. This control may mean a firm where every worker-owner participates in decision-making in a democratic fashion, or it may refer to one in which management is elected by ...

s. Although there is some debate as Bakunin and the collectivists favored market distribution using currency, collectivizing production, not consumption. Left libertarians collectivize neither but define their leftness as inalienable rights to the commons, not collective ownership of it, thus rejecting Lockean homesteading. Se
Centre for a stateless society

Utopian socialists Utopian socialism is the term often used to describe the first current of modern socialism and socialist thought as exemplified by the work of Henri de Saint-Simon, Charles Fourier, Étienne Cabet, and Robert Owen. Utopian socialism is often de ...

feel socialism can be achieved without

class struggle Class conflict, also referred to as class struggle and class warfare, is the political tension and economic antagonism that exists in society because of socio-economic competition among the social classes or between rich and poor. The forms ...

and that cooperatives should only include those who voluntarily choose to participate in them. Some participants in the

kibbutz A kibbutz ( he, קִבּוּץ / , lit. "gathering, clustering"; plural: kibbutzim / ) is an intentional community in Israel that was traditionally based on agriculture. The first kibbutz, established in 1909, was Degania. Today, farming h ...

movement and other

intentional communities An intentional community is a voluntary residential community which is designed to have a high degree of social cohesion and teamwork from the start. The members of an intentional community typically hold a common social, political, religious, ...

fall into this category.

Co-operative commonwealth

In some Co-operative economics literature, the aim is the achievement of a Co-operative Commonwealth; a society based on

cooperative A cooperative (also known as co-operative, 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 democratically-contro ...

and

socialist Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the ...

principles. Co-operative economists – Federalist, Individualist, and otherwise – have presented the extension of their economic model to its natural limits as a goal. This ideal was widely supported in early-twentieth century U.S. and Canadian leftist circles. This ideal, and the language behind it, were central to the formation of the

Co-operative Commonwealth Federation The Co-operative Commonwealth Federation (CCF; french: Fédération du Commonwealth Coopératif, FCC); from 1955 the Social Democratic Party of Canada (''french: Parti social démocratique du Canada''), was a federal democratic socialistThe foll ...

party in 1932, which became Canada's largest left-wing political party, and continues to this day as the

New Democratic Party The New Democratic Party (NDP; french: Nouveau Parti démocratique, NPD) is a federal political party in Canada. Widely described as social democratic,The party is widely described as social democratic: * * * * * * * * * * * * ...

. They were also important to the economic principles of the Farmer-Labor Party of the United States, particularly in the FLP's Minnesota affiliate, where advocacy for a Co-operative Commonwealth formed the central theme of the Party's platform from 1934, until the Minnesota FLP merged with the state

Democratic Party Democratic Party most often refers to: *Democratic Party (United States) Democratic Party and similar terms may also refer to: Active parties Africa *Botswana Democratic Party *Democratic Party of Equatorial Guinea *Gabonese Democratic Party *Demo ...

to form the Democratic–Farmer–Labor Party in 1944. Co-operative Commonwealth ideas were also developed in Great Britain and Ireland from the 1880s by

William Morris William Morris (24 March 1834 – 3 October 1896) was a British textile designer, poet, artist, novelist, architectural conservationist, printer, translator and socialist activist associated with the British Arts and Crafts Movement. He ...

, which also inspired the

guild socialist Guild socialism is a political movement advocating workers' control of industry through the medium of trade-related guilds "in an implied contractual relationship with the public". It originated in the United Kingdom and was at its most influent ...

movement for associative democracy from 1906 right through the 1920s. Guild socialist thinkers included

Bertrand Russell Bertrand Arthur William Russell, 3rd Earl Russell, (18 May 1872 – 2 February 1970) was a British mathematician, philosopher, logician, and public intellectual. He had a considerable influence on mathematics, logic, set theory, linguistics, ar ...

, R.H. Tawney and G.D.H. Cole.

Employee ownership

Some economists have argued that

economic democracy Economic democracy is a socioeconomic philosophy that proposes to shift decision-making power from corporate managers and corporate shareholders to a larger group of public stakeholders that includes workers, customers, suppliers, neighbour ...

could be achieved by combining

employee ownership Employee stock ownership, or employee share ownership, is where a company's employees own shares in that company (or in the parent company of a group of companies). US employees typically acquire shares through a share option plan. In the UK, Em ...

on a national scale (including worker cooperatives) within a

free market In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any o ...

apparatus. Tom Winters argues that "as with the free market more generally, it is not free trade itself that creates inequality, it’s how free trade is used, who benefits from it and who does not."

Cooperative microeconomics

According to Hervé Moulin, cooperation from a game-theoretic point of view ("in the economic tradition") is the mutual assistance between egoists. He distinguishes three modes of such cooperation, which are easily remembered using the (incomplete) motto of the French Revolution: #liberty: decentralised behaviour, where the collective outcome results from the strategic decisions of selfish agents; #equality: arbitration (by a mechanical formula or benevolent dictator) about actions on the basis of normative principles; #brotherhood: direct agreement between agents after face-to-face bargaining. These modes are present in every cooperative institution but their virtues are often logically incompatible.