By Jonathan Jenner
Worker-owners at the fast food chain and worker-cooperative, Indian Coffee House, in Trivandrum, India
Spend enough time discussing worker cooperatives around town, and you’ll encounter a frustratingly persistent idea: worker cooperatives are inefficient. It’s quite untrue, though, and for this reason you will not find an explicit statement of this idea as anyone’s talking point in the ever growing public discussion about worker cooperatives. Outside of public discussion, though, the idea finds refuge in two arenas: as a general, relatively unspoken attitude among people and as a derivation behind (some of) those high walls of economic theory. It’s time to put the idea to bed. So, here’s a quick look at where the idea comes from, and what empirical evidence has to say.
By Ricardo Fuentes-Ramírez
Many activists have turned to developing and supporting Worker Cooperatives as a fundamental part of building alternatives to our current system. In one of his recent books, economist Richard Wolff explains that there are many types of cooperatives, and activists should specifically coalesce around those that are “workers’ self-directed enterprises,” or WSDEs. Not all worker-owned enterprises, worker-managed enterprises, or cooperatives are necessarily WSDEs. In some worker-owned enterprises, worker/owners simply leave the directing of the enterprise in the hands of a board of directors. Worker-managed enterprises are usually firms in which owners give more control to workers while expecting more profits or growth, serving the interests of the former, not the latter. Finally, cooperatives include a wide variety of institutions, including firms for cooperative purchasing or selling. Many cooperatives are simply groups of small capitalists purchasing inputs cooperatively. To be considered a WSDE, the appropriation and distribution of the product of the workers’ labor has to be done cooperatively, and the workers who cooperatively produce it are identical to those who cooperatively appropriate and distribute it. In these firms, workers collectively determine what the enterprise produces, the appropriate technology, the location of production, and all related matters. For Wolff, these types of worker cooperatives are the building blocks for a future alternative system. Read more