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Are Workers Enterprises Entry Policies Conventional?


  • Michele Moretto

    () (Universita' di Padova)

  • Gianpaolo Rossini

    () (University of Bologna)


One of the reasons why workers'enterprises (WE) still represent a relevant chunk of the economy may lay in some affinities with conventional profit maximizing firms. To provide a solid basis to this presumption, we compare the entry policies of WEs and conventional firms when size is set at entry and kept fixed afterwards. Even though short run differences remain between WEs and conventional firms, a long run coincidence appears in an uncertain dynamic environment. Endogenizing size and time of entry we see that the two kinds of firms enter at the same trigger market price and size. Both of them enter earlier and choose a dimension larger than the minimum efficient scale. This generalised coincidence may be another way to explain why WEs still make for an important share of the economy (Hesse and Cihàk, 2007) despite the ongoing mantra of their imminent demise.

Suggested Citation

  • Michele Moretto & Gianpaolo Rossini, 2008. "Are Workers Enterprises Entry Policies Conventional?," "Marco Fanno" Working Papers 0066, Dipartimento di Scienze Economiche "Marco Fanno".
  • Handle: RePEc:pad:wpaper:0066

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    References listed on IDEAS

    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.
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    8. Martin Cihak & Heiko Hesse, 2007. "Cooperative Banks and Financial Stability," IMF Working Papers 07/2, International Monetary Fund.
    9. Michele Moretto & Gianpaolo Rossini, "undated". "Start-up entry strategies: Employer vs. Nonemployer firms," Working Papers ubs0409, University of Brescia, Department of Economics.
    10. John V. Leahy, 1993. "Investment in Competitive Equilibrium: The Optimality of Myopic Behavior," The Quarterly Journal of Economics, Oxford University Press, vol. 108(4), pages 1105-1133.
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    More about this item


    Workers' enterprises; entry; uncertainty; rigidity;

    JEL classification:

    • G13 - Financial Economics - - General Financial Markets - - - Contingent Pricing; Futures Pricing
    • J54 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Producer Cooperatives; Labor Managed Firms
    • L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise

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