The Co-operative Model of Enterprise

Resource type:	Book
Title:	Productivity in cooperatives & worker-owned enterprises: Ownership and participation make a difference
Author(s):	John Logue and Jacquelyn Yates
Date:	1 January 2005
File:	article-logue-yates.pdf
URL:
Category:	Employee Ownership

Productivity is the baseline measure of the economic efficiency of
firms. It is typically reported as value added per worker, value added per unit  of investment or value added per unit of assets Enterprises will fail to thrive in a market economy if they cannot meet or exceed the productivity of other firms in their sector.

The survival rate of Worker cooperatives and elnpleyee-owned ñrms
in market economies appears to equal or surpass that of conventional firms. But they typically return a different combination of econcmic benetìts to their member-owners than do conventional Íìrrns, because they place more emphasis on job security for employee-members and employees’ family members, pay competitive Wages (or slightly better than their sector), provide additional variable income through profit-sharingg, dividends or bonuses, and offer better fringe beneñts. They also support community facilities such as health clinics or schools.

In the developing World, cooperatives and employee-owned firms
have usually been supported as parastatals, to implement various
governmental goals. When governmental support was wgllhdrawn due to budgetary shortfalls or structural adjustment policies, most parastatal cooperatives failed, because productivity had been of little or no concern, and they were not prepared to compete in a market economy.