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Why exists so few labor managed firms?: A thoretical discussion map in economics

ISSNISSN/ISBN: 0797-7859
AutorAuthor/s: Dean, Andrés
EditorialEditorial: Quantum
The aim of the article is to review the theoretical literature that analyses a research problem seldom studied. Why worker cooperatives represent an insignificant proportion of firm’s population and total employment in any contemporary market economy? We identify at least four groups of explanations that emphasize the following key determinants: i) the investment and financial problems of worker cooperatives, ii) the incentive problems that arise in labor effort regulation, iii) the costs of collective decision making process and iv) the institutional setting and how it evolves, including the relationship between wealth inequality and the organizational selection process.
The article suggests a broad agenda for researchers interested on labor managed firm phenomenon and comparative organizational and economic system’s analysis. Moreover, it implicitly involves some relevant implications for public policies and worker cooperatives support institutions design.

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