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Is There a Cooperative Advantage?

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  • Altman, Morris

Abstract

Would you willingly pay more for groceries from the local cooperative than identical brands sold by the local branch of the privately-owned chain? Conventional economic theory suggests that a rational Homo Economicus would never entertain such a proposition. However Morris Altman's survey-based research on the role that social cohesion plays in consumers' choices reveals that not only are the individuals who are members of the cooperative (and may therefore participate in other benefits) willing to pay the higher prices so too are non-members. These results speak to the potential strengths of consumer cooperatives (relative to non-coops) in competitive markets as consumers value the non-material benefits they receive from the cooperative's investments in social cohesion.

Suggested Citation

  • Altman, Morris, 2011. "Is There a Cooperative Advantage?," Working Paper Series 4078, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
  • Handle: RePEc:vuw:vuwcsr:4078
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    File URL: http://researcharchive.vuw.ac.nz/handle/10063/4078
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    References listed on IDEAS

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    1. Altman, Morris, 2005. "The economics of ethics revisited and importance of economics: A response to the critics," Journal of Economic Psychology, Elsevier, vol. 26(5), pages 774-778, October.
    2. Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-1458, December.
    3. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-477, June.
    4. Morris Altman, 2006. "Opening-up the objective function: choice behavior and economic and non-economic variables—core and marginal altruism," Economics Bulletin, AccessEcon, vol. 4(33), pages 1-7.
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    Keywords

    cooperatives; consumers; social cohesion;

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