Values‐based Trust as a Shift Parameter for Collective Organizing: The Case of Magnum Photos

For economic agents seeking to organize collectively, opportunism is a central concern – any invasion by opportunistic agents can threaten an organization’s viability. To understand how economic agents address this concern, we examine Magnum Photos, an enduring elite cooperative of freelance photographers that screened prospective members based on shared values. We identify two mechanisms through which these shared values engendered non‐calculative trust that renders collective organizing economically viable. We unpack how this values‐based trust attenuates hazards of opportunism and promotes risk bearing and innovation when property rights are appropriately assigned to individual members and the size of the collective organization remains relatively small. We maintain that Magnum can be regarded as a form of collective entrepreneurship adopted by risk bearing agents bound together by shared values. We provide unique insight into how economic agents in industries beset by measurement problems can organize collectively around shared values to mitigate opportunism and innovate.