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The Degeneration of Workers’ Cooperatives under Endogenous Membership in Mixed Oligopoly

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  • Flavio Delbono
  • Carlo Reggiani

Abstract

We propose a new model of mixed oligopoly where a workers’ cooperative firms competes with a number of profit maximising companies. Building upon a large empirical evidence, we innovate as compared to the traditional literature on the objective function of the cooperative; moreover, its membership is treated as endogenous in the Cournot-Nash equilibrium. We show which factors may be responsible of the degeneration of the Workers’ cooperative firms, which occurs when the number of members shrinks with respect to the overall employees.

Suggested Citation

  • Flavio Delbono & Carlo Reggiani, 2024. "The Degeneration of Workers’ Cooperatives under Endogenous Membership in Mixed Oligopoly," Working Papers wp1194, Dipartimento Scienze Economiche, Universita' di Bologna.
    • Handle: RePEc:bol:bodewp:wp1194
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    References listed on IDEAS

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    1. Craig, Ben & Pencavel, John, 1992. "The Behavior of Worker Cooperatives: The Plywood Companies of the Pacific Northwest," American Economic Review, American Economic Association, vol. 82(5), pages 1083-1105, December.
    2. Flavio DELBONO & Carlo REGGIANI, 2013. "Cooperative Firms And The Crisis: Evidence From Some Italian Mixed Oligopolies," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 84(4), pages 383-397, December.
    3. Panu Kalmi, 2007. "The disappearance of cooperatives from economics textbooks," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 31(4), pages 625-647, July.
    4. Bonin, John P & Jones, Derek C & Putterman, Louis, 1993. "Theoretical and Empirical Studies of Producer Cooperatives: Will Ever the Twain Meet?," Journal of Economic Literature, American Economic Association, vol. 31(3), pages 1290-1320, September.
    5. Cecilia NAVARRA, 2016. "Employment Stabilization Inside Firms: An Empirical Investigation Of Worker Cooperatives," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 87(4), pages 563-585, December.
    6. Delbono, Flavio & Rossini, Gianpaolo, 1992. "Competition policy vs horizontal merger with public, entrepreneurial, and labor-managed firms," Journal of Comparative Economics, Elsevier, vol. 16(2), pages 226-240, June.
    7. Carlo Borzaga & Manlio Calzaroni & Chiara Carini & Massimo Lori, 2019. "Structure and Performance of Italian Cooperatives: A Quantitative Analysis Based on Combined Use of Official Data," Journal of Entrepreneurial and Organizational Diversity, European Research Institute on Cooperative and Social Enterprises, vol. 8(1), pages 65-83.
    8. Mikami, Kazuhiko, 2018. "Are cooperative firms a less competitive form of business? Production efficiency and financial viability of cooperative firms with tradable membership shares," Economic Systems, Elsevier, vol. 42(3), pages 487-502.
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    More about this item

    JEL classification:

    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • P13 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Cooperative Enterprises

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