Methods to promote cooperatives

On this site we have proposed several methods which the government could use to stimulate the creation of a cooperative economy.

First of all, the government should give preferential treatment to worker cooperatives when procuring goods and services from the private sector. This will give cooperatives an advantage and hence create an inducement to start a cooperative and to maintain them.

Also the government could set up a finance company which will help people with funding a cooperative through either finance or operating lease. This way the start-up costs and hence risks for new cooperatives will be reduced. By reducing the costs of setting up a cooperative, their formation will become more attractive.

Further the government should create a level playing field between wage labor and self-employment. This requires, for instance, the abolition of minimum wage laws and its replacement with some kind of basic income guarantee. A basic income will reduce the risk people face when they run their own businesses.

Another idea is when people who have lost their job apply for unemployment benefits, to inform them of the possibility to set up a cooperative with other people who lost their jobs. This should be combined with a retraining program, to ensure people will have the necessary skills to operate a worker cooperative.

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