Co-operation. In the social and economic sense of the word, co-operation generally means the association of work-people for the management of their own industrial interests, in store, workshop, or other undertaking, and the equitable distribution of profits among those who earn them. In Great Britain it has succeeded best in distribution, that is, in the form of co-operative stores for the supply of the domestic wants of the workmen's families; in Germany and Italy it has flourished chiefly under the form of people's banks, for furnishing mutual credit to workmen and also small tradesmen. Co-operative production has not yet made corresponding progress. The co-operative movement acquired vitality with the foundation of the Rochdale Society of Equitable Pioneers in 1844. Before that date there had been instances of co-operative industry among English miners, New England fishermen, and the Greek sailors of the Levant. In Great Britain there exist even yet co-operative societies, which were founded prior to 1844; one at Govan, said to have been established in 1777, and another at Hull, started in 1795. The earliest in England, however, was that founded in 1794 at Mongewell, in Oxfordshire, by Shute Barrington, Bishop of Durham. During the Owenite agitation from 1820 to 1845, the movement began to assume national importance, hundreds of societies rising up, which for the most part rapidly disappeared. By general consent it is agreed that the movement took practical and permanent form with the Rochdale Pioneers (1844). The founders were twenty-eight weavers, nearly all of whom were socialists of the Owen school and Chartists; and their original capital was £28, painfully collected by subscriptions of twopence, afterwards raised to threepence a week. With this capital they opened a store for supplying themselves with provisions, but at first they had only four articles to sell—flour, butter, sugar, and oatmeal. Their success, which was steady and rapid, was chiefly due to their device of limiting interest on shares to 5 per cent. and dividing profits among members in proportion to their purchases. By 1857 they had a membership of 1850, a capital of £15,000, and annual sales to the amount of £80,000. Their society, its organisation and methods of conducting business, became a model to the working-men in the north and centre of England, as also in Scotland. In this way the movement rapidly spread, and the societies are now over 1400 in number, with nearly a million members. In 1864 the Wholesale Society for the supply of commodities to the various stores was established at Manchester, and a second at Glasgow in 1869; but the two work in harmony, and may be considered as one institution. In 1871 the Co-operative News was started as the organ of the co-operators. Since 1869 national congresses of co-operative societies have been held every year in one or other of the large towns of Great Britain. These may be regarded as the annual parliaments of co-operators. The efforts after organisation culminated in the consolidation of the Co-operative Union with a regular constitution drawn up in 1873. Subject to the congress, the Union is governed by a United Board of twelve members, representing the six sections into which the union is divided. The sectional boards have monthly meetings of their own. The Central Co-operative Board, consisting of all the members representing the six sections, comes together for business only at meetings of congress.
Having thus sketched the general development of English co-operation, we shall now more specifically indicate the rules and organisation of the societies. Any one may become a member on paying an entrance fee of one shilling, and members may pay up their shares at the rate of threepence a week. Shares are usually one pound each, and one or two of these shares, transferable but not withdrawable, constitutes all the capital a member is required to hold. The other share capital that a member may hold is withdrawable. The interest on capital is limited to 5 per cent. Goods are sold at the prices current among respectable shopkeepers in the neighbourhood, and after paying expenses the nett profits are distributed quarterly among the members in proportion to their purchases. These dividends may be allowed to accumulate in the store, but no member is permitted by law to hold more than £200. The general rule is that payments be made in ready money, a system to which co-operation largely owes its success, but which is not yet universal. At the congress of 1888 complaints were made that the credit system is to some extent permitted. Irrespective of the amount of his investments, each member has only one vote. The members elect a committee for the management of the business. The committees have frequent meetings, and control the employees of the store. The members themselves hold quarterly and in many cases monthly meetings. The Wholesale Society is a federation of retail societies, which have to take up shares, and they participate in the management in proportion to their membership. The Wholesale is a large and growing organisation for the supply of goods to the various societies composing it, with purchasing and forwarding depôts not only in England and Ireland, but in New York, Hamburg, Copenhagen, Calais, and Rouen. It owns five steamships, which ply between England and the Continent. It has also extensive productive works, as boot and shoe factories at Leicester, soap-works at Durham, woollen-cloth works at Batley, &c. Besides the productive works thus conducted by the Wholesale Society, there are a number of societies for production alone, societies for working corn-mills, and a number of retail societies which carry on corn-mills and various branches of domestic production. The annual production by societies adhering to the Co-operative Union may probably be estimated at about £5,000,000. In addition to the societies already mentioned, there is a co-operative fire and life insurance society, and the Co-operative News Society; started in 1871 for carrying on the organ of the co-operators. It should also be mentioned that the societies spend considerable sums in education.
Statistics of English Co-operation, taken from the report of the Co-operative Congress for 1888: Connected with the Co-operative Union, were (in 1887) 1432 societies, with a membership of 945,619, a share capital of £10,012,048, and sales to the amount of £34,189,715, on which profits to the amount of £3,193,178 were made. In 1895 the membership was 1,414,158, the share capital £16,164,667, the sales £52,512,126 (with a net profit of £5,397,582). Co-operative manufacturing as well as co-operative distribution was steadily extending—the latter type, however, much more slowly than the other. About one-sixth of the population of Great Britain have their wants in whole or in part supplied through co-operative stores.
Co-operation in England is thus already one of the established institutions of the country, the importance of which has been recognised alike by statesmen and economists. Though essentially a workmen's movement, it should be said that it owes much to the enlightened and philanthropic guidance of men of other classes, to Robert Owen,
Maurice, and Kingsley. Messrs Neale, Holyoake, Hughes, Ludlow, and the Marquis of Ripon have also powerfully aided in promoting it.
In the United States of America co-operation has not made such progress as might have been expected from the energy and spirit of initiative prevalent among the people. Though co-operation had previously existed among the fishermen of New England, the Brook Farm (q.v.) experiment may be regarded as the starting-point of the movement. Co-operative business in New England may in an average year reach the following figures: In distribution, £600,000; productive co-operation, exclusive of dairies or creameries, £200,000; creameries, £150,000; banks, £800,000—in all, about £1,750,000. In Philadelphia, co-operative building societies have provided the workmen with from 80,000 to 100,000 homes. The same form of co-operation flourishes in other parts of the country. A notable and thoroughly successful effort in productive co-operation has been made in the cooping trade at Minneapolis since 1874. In 1882 the students of the university of Harvard formed a co-operative society for supplying themselves with books, stationery, and other articles. The movement has been a success, and has been imitated by the universities of Yale and Michigan. The general result, however, of a study of co-operation in America is that while the experiments have been numerous, varied, and in many cases successful, its influence has been on a limited scale. The rewards offered to every kind of exceptional capacity in private enterprise are so enormous, the scope for the development of individual energy in all directions is still so great, that the workmen have not yet widely realised the necessity for industrial association among themselves. Many important firms have, however, successfully introduced the system of sharing profits with their work-people. Complaints are made that the laws of some of the states do not offer reasonable facilities for the formation of co-operative societies.
In France the industrial partnership system, by which the capitalist gives his workmen a share in his profits, has made greater progress than the co-operative movement properly so called. At the revolution of 1848 the government gave some scanty subsidies to co-operative production, but only a few of the societies prospered. Even yet co-operative stores, co-operative banks, and societies for co-operative production have only had a limited success. See PROFIT-SHARING.
In Germany co-operation has flourished greatly in the form of people's banks. These originated in 1849 under the auspices of Schulze-Delitzsch, at the little town of Delitzsch in Saxony. In 1885 there were 3822 societies belonging to the Schulze-Delitzsch system, of which 1965 were credit societies, 678 for distribution, 493 for the purchase of raw material, &c. The societies had an aggregate membership of 1,500,000, a share and reserve capital of £15,000,000, a loan capital of £25,000,000, and did an annual business of £150,000,000. Since 1859 they have held annual congresses. Schulze-Delitzsch was salaried counsellor (anwalt) or general manager of the societies till his death in 1883. In 1885 there were 145 productive associations in Germany. While there were in 1873 only 6 co-operative dairies in Germany, there were 226 of them in 1885. In addition to all these, in 1884 there were 800 societies (called after Raiffcisen, their founder), whose function it is to provide mutual credit for the small farmers of Germany. In 1895 there were (including the last-named) in all Germany 11,141 societies, of which 647 were credit societies. Austria had in 1894, 2050 associations, besides some 500 in Hungary.
In Italy co-operation is making great progress, chiefly in the form of people's banks. In 1883 there were 250 such banks. At the end of 1885 their number had increased to 423, with £2,500,000 of share capital and about £13,000,000 of loan capital. In 1895 there were 950. Co-operation in other forms also is rapidly making way—there are co-operative dairies, and besides there are many co-operative bakeries, established with a view to checking the ravages of Pellagra (q.v.) by the supply of wholesome bread. Such institutions receive the support of the Italian government.
In Belgium the co-operative movement has established itself on a very considerable scale at industrial centres such as Ghent, in stores, bakeries, and in co-operative fisheries.
In Denmark co-operative dairies have recently been making wonderful progress (see DAIRY).
The various Professional and Civil Service stores are simply a result of the application of the co-operative system for the supply of the wants of the middle classes, especially the professional classes and clerks, begun in 1864; and these stores now do a very large business, the largest being the Army and Navy Stores in Victoria Street, London. The salient difference between this middle-class co-operation and that of the working-men is that the former admits of the system of privileged shareholders, whereas all the benefits of the latter are open to every one who pays an entrance fee of one shilling.
From the above facts it will be apparent that the purpose and tendency of the co-operative movement is that the workmen, through the principle of associated industry, by means of a joint capital, should equitably manage their own affairs so far as they can. Such management, we have seen, has been applied on a large scale to distribution and to people's banks, and has had a considerable success also in various forms of domestic production, as in corn-mills, bakeries, boot and shoe factories, dairies, &c. In the large and staple branches of manufacture it has as yet done very little. But so far as it has gone, the movement has been a real and effectual training for the intelligence, business capacity, and moral character of the workmen. It has taught them thrift, foresight, self-control, and the habit of harmonious combination for common ends; and it has opened up an unlimited field for peaceful, hopeful, and successful effort in the future.
See Holyoake's History of Co-operation (2 vols.), and his Self-help a Hundred Years Ago (1888); the reports of the Co-operative Congress; Working-men Co-operators, by A. H. D. Acland and B. Jones (1884); Reports on Co-operation in Foreign Countries, a blue-book issued in 1886; English Associations of Working-men, by Dr Baernreither (1888). See also History of Co-operation in the United States, published under the auspices of Johns Hopkins University (Baltimore, 1888).