This paper explores whether the dual characteristics of a worker cooperative – one as a democratic institution and the other as a business enterprise – pose unique challenges to the success and growth of the worker cooperative in the manufacturing sector. Relying on simulations of the Marxian circuit of capital model that was originally designed to identify a series of necessary conditions for the reproduction of the capital- labor relation, this paper asserts that the worker cooperative tends to face a more serious difficulty in mobilizing financial resources for the operation of the production and sales activity, in addressing transportation and logistical challenges, and effectively managing sales promotions compared to conventional profit-driven capitalist enterprises. In the absence of proper public policy support, the efforts of the cooperative to maintain a careful balance between democratic decision making and effective implementation of the strategic business plan tends to hinder the ability of the cooperative to achieve a faster and more competitive growth. It is also argued that the identification of these challenges facing the representative worker cooperative, in turn, can help better design a public policy framework that is conducive to nurturing and developing worker cooperatives and their networks.
This paper explores whether the dual characteristics of a worker cooperative – one as a democratic institution and the other as a business enterprise – pose unique challenges to the success and growth of the worker cooperative in the manufacturing sector. Relying on simulations of the Marxian circuit of capital model that was originally designed to identify a series of necessary conditions for the reproduction of the capital- labor relation, this paper asserts that the worker cooperative tends to face a more serious difficulty in mobilizing financial resources for the operation of the production and sales activity, in addressing transportation and logistical challenges, and effectively managing sales promotions compared to conventional profit-driven capitalist enterprises. In the absence of proper public policy support, the efforts of the cooperative to maintain a careful balance between democratic decision making and effective implementation of the strategic business plan tends to hinder the ability of the cooperative to achieve a faster and more competitive growth. It is also argued that the identification of these challenges facing the representative worker cooperative, in turn, can help better design a public policy framework that is conducive to nurturing and developing worker cooperatives and their networks.
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