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It's interesting then how cooperatives aren't more popular or more successful. You'd think that if they were significantly more efficient than the typical dicta

It's interesting then how cooperatives aren't more popular or more successful. You'd think that if they were significantly more efficient than the typical dictatorship companies then they'd outcompete them, but as far as I'm aware that doesn't happen.

coxmichael 3y ago
It’s harder to get finance as a co-operative, so it’s hardly a fair competition. Also, in most studies, co-ops and employee ownership models do actually end up being more profitable and sustainable in the long term [0, 1]. [0] Page 23+ in this UK government review on employee ownership: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/31706/12-933-sharing-success-nuttall-review-employee-ownership.pdf https://assets.publishing.service.gov.uk/government/uploads/... [1] ONS report showing the rate of survival of cooperatives in the UK after five years was 80 percent compared with only 41 percent for all other enterprises https://www.uk.coop/sites/default/files/2020-10/co-operative_survival_1.pdf https://www.uk.coop/sites/default/files/2020-10/co-operative...
- Shaanie 3y ago
  Skimmed the first report and it seems like employee-owned companies perform better up until around 75 employees, after which there's no benefit? That would explain why they aren't outcompeting the larger companies - their advantage disappears when they grow.
  - coxmichael 3y ago
    I’d wager that’s more to do with raising finance than organisational productivity, but I’m not aware of any actual research on something of that scale or even how to accurately study those effects without it turning into more of a qualitative theory. Still, it’s quite an interesting possibility worth pursuing in my opinion. (Full disclosure, I work for a small nominally employee-owned company, and have mixed thoughts about how it works in practice).
swiftcoder 3y ago
I think there's often an issue of how you measure success. Co-ops seem to have much lower tendency to try and take over the world than corporations inevitably seem to display at scale - quite content to return comfortable salaries year-after-year to their employee-owners, rather than reap profits at all costs. As a concrete example, Mondragon has been operating very successfully for ~70 years, but barely anyone from outside the region registers its existence.
- datavirtue 3y ago
  Right, and if this was the enforced model there would be a lot better spread of risk and a lot more competition. But it's Socialism!!!! Instead we are almost down to one or two grocery chains and the government is left with the impossible task of regulating the consolidation to mitigate risk and screwed prices.

coxmichael 3y ago

It’s harder to get finance as a co-operative, so it’s hardly a fair competition. Also, in most studies, co-ops and employee ownership models do actually end up being more profitable and sustainable in the long term [0, 1]. [0] Page 23+ in this UK government review on employee ownership: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/31706/12-933-sharing-success-nuttall-review-employee-ownership.pdf https://assets.publishing.service.gov.uk/government/uploads/... [1] ONS report showing the rate of survival of cooperatives in the UK after five years was 80 percent compared with only 41 percent for all other enterprises https://www.uk.coop/sites/default/files/2020-10/co-operative_survival_1.pdf https://www.uk.coop/sites/default/files/2020-10/co-operative...

Shaanie 3y ago
Skimmed the first report and it seems like employee-owned companies perform better up until around 75 employees, after which there's no benefit? That would explain why they aren't outcompeting the larger companies - their advantage disappears when they grow.
- coxmichael 3y ago
  I’d wager that’s more to do with raising finance than organisational productivity, but I’m not aware of any actual research on something of that scale or even how to accurately study those effects without it turning into more of a qualitative theory. Still, it’s quite an interesting possibility worth pursuing in my opinion. (Full disclosure, I work for a small nominally employee-owned company, and have mixed thoughts about how it works in practice).

swiftcoder 3y ago

I think there's often an issue of how you measure success. Co-ops seem to have much lower tendency to try and take over the world than corporations inevitably seem to display at scale - quite content to return comfortable salaries year-after-year to their employee-owners, rather than reap profits at all costs. As a concrete example, Mondragon has been operating very successfully for ~70 years, but barely anyone from outside the region registers its existence.

datavirtue 3y ago
Right, and if this was the enforced model there would be a lot better spread of risk and a lot more competition. But it's Socialism!!!! Instead we are almost down to one or two grocery chains and the government is left with the impossible task of regulating the consolidation to mitigate risk and screwed prices.