Cooperative

A cooperative is an autonomous association of people. These individuals unite voluntarily to meet common economic, social, or cultural needs. They do so through a jointly owned and democratically controlled enterprise. In a cooperative, members hold the power. Each member typically has one vote to elect a board of directors. This structure makes them different from collectives. While collectives often operate from the top-down, cooperatives are generally built from the bottom-up.

There are several distinct types of cooperatives based on who owns them. Worker cooperatives are owned and managed by the employees. These businesses are often very resilient. In the United Kingdom, 80% of worker cooperatives survive their first five years. This is much higher than the 44% survival rate for other business models. Consumer cooperatives are owned by the people who buy their goods or services. Producer cooperatives allow producers, such as farmers, to pool their output for mutual benefit.

Other specialized models exist to serve specific needs. Purchasing cooperatives allow members to pool their buying power. Multi-stakeholder or hybrid cooperatives share ownership between different groups. For example, a care cooperative might include both caregivers and those receiving care. Platform cooperatives use digital tools like websites or mobile apps to facilitate sales. These digital platforms are themselves owned and governed by the cooperative members. Second- and third-tier cooperatives are unique because their members are other cooperatives.

Cooperation has deep roots in human history. Early tribes used cooperative structures to allocate jobs and resources. In 1472, people in alpine environments used organized cooperatives to create artificial roads like the Viamala. The modern movement grew from the industrial context of pre-industrial Europe. In 1761, the Fenwick Weavers' Society in Scotland helped workers by selling discounted oatmeal. They also assisted with savings, loans, and education.

Social reformers played a major role in shaping these ideas. Robert Owen was a key pioneer who improved labor standards at the New Lanark mill. He introduced discounted retail shops so profits went back to employees. In 1810, Reverend Henry Duncan founded a friendly society in Scotland. This created a depository institution where poor parishioners could hold interest-bearing savings accounts. This institution later merged into the Trustee Savings Bank.

The Rochdale Society of Equitable Pioneers is a vital historical example. Founded in 1844 by 28 weavers in England, it became a model for modern cooperatives. They followed the 'Rochdale Principles' to sell food that artisans could afford. Within ten years, the United Kingdom had over a thousand cooperative societies. In Central Europe, Samuel Jurkovič founded Spolok Gazdovský in 1845. This was a credit union that provided cheap loans through member savings. Members even committed to planting two trees in public every year.

The scale of the cooperative movement is massive. Research from the Worldwatch Institute shows that in 2012, approximately one billion people in 96 countries were members of at least one cooperative. The turnover of the largest 300 cooperatives reached $2.2 trillion. Cooperatives also focus on social goals. In 2013, UK retail cooperatives invested 6.9% of their pre-tax profits back into their communities. This was significantly higher than the 2.4% invested by rival supermarkets.

Cooperatives connect to broader ideas like economic democracy. This concept expands decision-making power from a few shareholders to many stakeholders. This movement has influenced various political and social theories. For example, some groups focus on local organization through confederations. Others have focused on reforming larger scales of human organization. Even in technology, cooperatives lead the way. The Stanford Federal Credit Union was the first to offer online banking in 1994. Today, the .coop domain helps identify these organizations on the internet.