IDEAS home Printed from https://ideas.repec.org/a/eee/ecolet/v171y2018icp41-45.html
   My bibliography  Save this article

On the endogenous determination of the degree of meritocracy in large cooperatives

Author

Listed:
  • Torregrosa, Ramón J.

Abstract

We consider a cooperative formed by a large number of workers differentiated by their initial endowment of wealth, which is both primary input (labor) and consumption (leisure). The cooperative is characterized by its wealth distribution, and produces a consumption good from labor, which allocates among workers according to a convex combination of the Proportional and the Egalitarian rule. In the first stage, workers decide this combination by simple majority. In a second stage, they choose how much labor to provide to the cooperative. We find that when in the cooperative’s wealth distribution, the median wealth is lower (higher) than the average, the degree of meritocracy chosen by workers is lower (higher) than that of the optimum, and coincides with it when both statistics coincide. This choice has similar consequences on the cooperative’s labor–output, since it increases with respect to the degree of meritocracy.

Suggested Citation

  • Torregrosa, Ramón J., 2018. "On the endogenous determination of the degree of meritocracy in large cooperatives," Economics Letters, Elsevier, vol. 171(C), pages 41-45.
  • Handle: RePEc:eee:ecolet:v:171:y:2018:i:c:p:41-45
    DOI: 10.1016/j.econlet.2018.06.027
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0165176518302507
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.econlet.2018.06.027?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kang, Suk, 1988. "Fair distribution rule in a cooperative enterprise," Journal of Comparative Economics, Elsevier, vol. 12(1), pages 89-92, March.
    2. Corchon, Luis C. & Puy, M. Socorro, 1998. "Individual rationality and voting in cooperative production," Economics Letters, Elsevier, vol. 59(1), pages 83-90, April.
    3. Amartya K. Sen, 1966. "Labour Allocation in a Cooperative Enterprise," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 33(4), pages 361-371.
    4. repec:bla:annpce:v:89:y:2018:i:1:p:87-107 is not listed on IDEAS
    5. Barberà, Salvador & Beviá, Carmen & Ponsatí, Clara, 2015. "Meritocracy, egalitarianism and the stability of majoritarian organizations," Games and Economic Behavior, Elsevier, vol. 91(C), pages 237-257.
    6. Roemer John E. & Silvestre Joaquim, 1993. "The Proportional Solution for Economies with Both Private and Public Ownership," Journal of Economic Theory, Elsevier, vol. 59(2), pages 426-444, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:bla:annpce:v:89:y:2018:i:1:p:87-107 is not listed on IDEAS
    2. Beviá, Carmen & Corchón, Luis C., 2017. "Growth in Illyria: The role of meritocracy in the accumulation of human capital," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 182-190.
    3. Roger Hartley & Richard Cornes, 2004. "Mixed sharing rules," Econometric Society 2004 Australasian Meetings 196, Econometric Society.
    4. Beviá, Carmen & Corchón, Luis C., 2009. "Cooperative production and efficiency," Mathematical Social Sciences, Elsevier, vol. 57(2), pages 143-154, March.
    5. Bevia Carmen & Corchón Luis C, 2006. "Rational Sabotage in Cooperative Production with Heterogeneous Agents," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 6(1), pages 1-29, November.
    6. Tortia, Ermanno, 2014. "L'impresa come bene comune," AICCON Working Papers 131-2013, Associazione Italiana per la Cultura della Cooperazione e del Non Profit.
    7. Anke Gerber & Andreas Nicklisch & Stefan Voigt, 2013. "Strategic Choices for Redistribution and the Veil of Ignorance: Theory and Experimental Evidence," CESifo Working Paper Series 4423, CESifo.
    8. Leroux, Justin, 2004. "Pooling Private Technologies: Improving upon Autarky," Working Papers 2004-08, Rice University, Department of Economics.
    9. Friedman, Eric & Moulin, Herve, 1999. "Three Methods to Share Joint Costs or Surplus," Journal of Economic Theory, Elsevier, vol. 87(2), pages 275-312, August.
    10. Dhritiman Gupta, 2020. "Prize sharing rules in collective contests: When does group size matter?," Discussion Papers 20-04, Indian Statistical Institute, Delhi.
    11. Joan Esteban & Laura Mayoral & Debraj Ray, 2012. "Ethnicity and Conflict: An Empirical Study," American Economic Review, American Economic Association, vol. 102(4), pages 1310-1342, June.
    12. Roberto Veneziani & Luca Zamparelli & Naoki Yoshihara, 2017. "A Progress Report On Marxian Economic Theory: On The Controversies In Exploitation Theory Since Okishio (1963)," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1421-1448, December.
    13. Hervé Moulin & Yves Sprumont, 2007. "Fair allocation of production externalities : recent results," Revue d'économie politique, Dalloz, vol. 117(1), pages 7-36.
    14. Joaquin Silvestre, 1994. "Economic analysis of public ownership," Investigaciones Economicas, Fundación SEPI, vol. 18(1), pages 19-66, January.
    15. Biung†Ghi Ju & Juan D. Moreno†Ternero, 2017. "Fair Allocation Of Disputed Properties," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58(4), pages 1279-1301, November.
    16. Tian, Guoqiang, 2000. "Incentive Mechanism Design for Production Economies with Both Private and Public Ownerships," Games and Economic Behavior, Elsevier, vol. 33(2), pages 294-320, November.
    17. Sylvain Ferrières, 2017. "Nullified equal loss property and equal division values," Theory and Decision, Springer, vol. 83(3), pages 385-406, October.
    18. Yoshihara, Naoki & Veneziani, Roberto, 2018. "The Theory Of Exploitation As The Unequal Exchange Of Labour," Economics and Philosophy, Cambridge University Press, vol. 34(3), pages 381-409, November.
    19. Jonathan F. Cogliano & Roberto Veneziani & Naoki Yoshihara, 2019. "Exploitation, skills, and inequality," Review of Social Economy, Taylor & Francis Journals, vol. 77(2), pages 208-249, April.
    20. Evren, Özgür, 2012. "Altruism and voting: A large-turnout result that does not rely on civic duty or cooperative behavior," Journal of Economic Theory, Elsevier, vol. 147(6), pages 2124-2157.
    21. Depken II, Craig A. & Redmount, Esther & Snow, Arthur, 2001. "Shirking and the choice of technology: a theory of production inefficiency with an empirical application," Journal of Economic Behavior & Organization, Elsevier, vol. 44(4), pages 383-402, April.

    More about this item

    Keywords

    Cooperative production; Egalitarianism; Meritocracy; Majority voting; Two-stage equilibrium;
    All these keywords.

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • H82 - Public Economics - - Miscellaneous Issues - - - Governmental Property
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
    • P13 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Cooperative Enterprises

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecolet:v:171:y:2018:i:c:p:41-45. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ecolet .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.