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Tag Archives: cooperative

Is Another Economics Possible–This article attracted my attention because I have been thinking, for a couple of years now, that another economics is necessary.

Disappointment followed as I read through the article. The views described are those of the World Social Forum, “based on more cooperative, sustainable, egalitarian and democratic institutions than those favored at (the World Economic Forum in) Davos, Switzerland.”

Textbook economics treats individuals as selfish optimizers, unconcerned about the welfare of others. Only recently have economists begun to explore the importance of fairness, reciprocity and altruism, and to consider the possibility that incentives to behave selfishly can undermine both moral norms and altruistic preferences.

Textbook economics also largely ignores worker-owned businesses and consumer cooperatives, although these are geographically widespread in the United States. Recent research suggests that many workers would like to play a larger role in the management of their companies and that “shared capitalism” works remarkably well.

Of course these views are only valid for a superficial sort of economics. In real economics, being a “selfish optimizer” includes our desires to help our friends and communities.

While I like the idea of encouraging cooperative enterprise and egalitarianism, those are not new ideas and there is not a new economics being introduced. only old ideals reborn.

A new economics needs to explain how the world’s markets are working, and how government policy can help or hurt social welfare. My opinion? We need to get away from the Keynesian measures of growth and employment. They are not the best measures of welfare and happiness and satisfaction with our lives. Ultimately, those are much more important than how much money and stuff we have.

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To jumpstart US job market, turn workers into owners–this is an idea I really like, but I doubt many business owners will turn this direction.

Seldom do the United Steelworkers, the United Nations, and film director Michael Moore express the same idea at the same time. But all have, in their own way, promoted the benefits of cooperative businesses in recent months.

Cooperatives–worker-owned businesses–are not at all a new idea, but I am glad to see it is gaining favor again. It is something I wanted to do with my restaurant some 26 years ago. The article cited here focuses on how cooperatives might help the US economy back to growth and high employment, but the real value of cooperatives is the proper placement of incentives.

Profit is typically the incentive of investors, but if it were also the incentive of workers imagine the potential for a really productive enterprise, with people going about their work because they really care about it.

Time to finally behead the paternalistic monster. That kind of management is not suited for a cooperative (it does not work anyway) and people are perfectly capable of motivating themselves if it is for the right reasons.

Utopian literature often introduces cooperatives as a model for their communities. Some people say it will never work, but I think it depends on the level of cooperation and realistic expectations.

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