The economics and finance of dividend-based labor remuneration and tradable shares in worker cooperatives

TORTIA, Ermanno (2025): The economics and finance of dividend-based labor remuneration and tradable shares in worker cooperatives.

Abstract

This paper examines the economic and financial implications of implementing a comprehensive system of dividend-based labor compensation for members of worker cooperatives. The economic implications, as presented in the existing literature, are discussed at both the microeconomic and macroeconomic levels, as already presented prominently in the work of James Meade and Martin Weitzman. The financial implications concern the creation of a clear link between dividend-based remuneration and the financial position of worker-members as owners of a cooperative's capital; the alignment of interests between worker-members and non-member financial investors when creating a true cooperative share market; and the decoupling of financial participation of members and non-members from control rights (cooperative shares would be non-voting) to protect the formal and substantive role of the mutualistic ‘one member, one vote’ principle of democratic governance.

• Item Type: MPRA Paper
• Language: English
• Keywords: Dividend-based labor remuneration; undercapitalization; cooperative shares; interest alignment; cooperative property rights; mutualistic governance
• Subjects: D - Microeconomics > D2 - Production and Organizations > D21 - Firm Behavior: Theory; D - Microeconomics > D2 - Production and Organizations > D23 - Organizational Behavior ; Transaction Costs ; Property Rights; D - Microeconomics > D2 - Production and Organizations > D24 - Production ; Cost ; Capital ; Capital, Total Factor, and Multifactor Productivity ; Capacity; G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy ; Financial Risk and Risk Management ; Capital and Ownership Structure ; Value of Firms ; Goodwill; G - Financial Economics > G3 - Corporate Finance and Governance > G35 - Payout Policy

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