In Search of a Self-Provisioning Society

A self-provisioning society can be an intersection of the commons, as envisioned by Nobel Laureate Elinor Ostrom, and cooperative economics, a branch of heterodox economic thought.

Shereein Saraf

Shereein Saraf

June 04, 2021 / 8:00 AM IST

In Search of a Self-Provisioning Society

A self-provisioning society can be an intersection of the commons, as envisioned by Nobel Laureate Elinor Ostrom, and cooperative economics, a branch of heterodox economic thought.

In this world of reinventing capitalism – producer’s capitalism to shareholder capitalism – and growing consumerism, society needs cooperation and cooperatives. These “self-provisioning” mechanisms have come forward time and again to avert a crisis. 

Cooperatives, unlike capitalist firms, are not run by distant institutional investors or shareholders but by people who are producers and customers. These are autonomous, requiring voluntary participation, democratic, boast of cooperation within communities, and depend on the economic participation of their members. 

Historically, cooperatives emerged on the production side and in the food sector, but they have grown and diversified since then. While organic food cooperatives promote better nutrition and a greener environment, housing cooperatives help property purchases affordable. Energy cooperatives reduce the use of fossil fuels and generate need-based green electricity.

In West Africa and the Caribbean, cooperatives trace back to microfinance institutions and one of the oldest financial communities, the susu collectors. They acted as mobile bankers to the small kiosks in the marketplace across parts of Africa. Besides producer’s cooperatives that focus on marketing, co-exists worker’s cooperatives, focusing on producing goods and services for the community. Consumer or retail cooperatives educate and empower consumers, such as in a housing cooperative. 

Commons, on the other hand, are “self-provisioning” but a perceptible threat to resource depletion. The tragedy of commons has become a well-acclaimed terminology summarising the problems with commons. It works with the assumption that every individual act in their self-interest and are not excludable from using resources that are available to them, even at the expense of others. One example quoted is that of a shepherd who allows his flock to graze on common pastures. Observing this, other shepherds will do the same. The shepherds could also buy another sheep as it will marginally reduce the lushness of the greens. And the tragedy of overexploitation begins. 

Two alternative models predict strategies of players sharing Common Pool Resources (CPR). These are the Prisoners’ Dilemma, where non-cooperation leaves individuals better-off, and, lastly, Olson’s Logic of Collective Action. The latter suggests large groups are incompatible with the commons due to communication gaps and organizational costs. But Ostrom believed that these scenarios were extreme. 

The idea of governing the commons is a prerequisite to their functioning, which involves bringing together a well-defined community and using compliance mechanisms. The solution to the problems faced by commons is three-fold. For one, there is a need to manage supply using constitutional and collective choice rules. Incentivizing the commitment to commons is another such measure. There must also be mutual monitoring to disincentive any free-riders. 

To the commons criticism, Elinor Ostrom also proposed new features in its design. Commons should have clearly defined boundaries, rules, and abundant local supplies. The choice arrangements should be collective with appropriate monitoring and sanctions. Further, the commons must recognize mechanisms for conflict resolutions and rights to organize into enterprises.

Even the cooperative economy has its share of drawbacks. Friction among cooperatives competing for ownership or governance over shared resources causes networking gaps. Cooperatives, thus, sometimes are unable to build efficient networks and strengthen their economic viability. There is also a lack of democratic control within the cooperative and a reduction in voluntary memberships. 

While both commons and cooperatives are self-organizing, there are some notable differences. Unlike cooperatives, commons are not economic players but systems of collaborative organization in search of sustainable solutions. They involve individuals and communities but lack monetary resources or property rights. An economic function of the commons is the ability to mobilize resources within a social organization strategically. 

It is much easier to see how cooperatives act as economic actors. They have the resources – monetary and otherwise and work towards the well-being of their members. These can be private, membership-centered, and can have stakeholders from the outside. Unlike private-sector firms, cooperatives distribute roles and responsibilities, in line with their objectives, through a democratic process.

An intersection of the commons and cooperatives might be a solution to these shortcomings. Communities should see commons as a social process with features of the cooperative economy such as production and distribution governed by solidarity and reciprocity. In this social economy, communities would follow fair trade initiatives and peer-to-peer resource sharing, crowdfunding being an example. 

Commons-Cooperative intersectionality has aided communities with timely action in response to the COVID-19 crisis. People, irrespective of race and creed, have come together to build aid networks and share resources – financial and non-financial in the wake of the pandemic. It has also shifted people who traditionally were employed to create jobs for themselves and others, partly due to the rise of the digital service economy. 

In the past months, as the pandemic took a turn for the worse, in vaccine-deficient economies, local people took up crowdfunding initiatives. Communities used underutilized public resources, along with adequate individual support, in a democratic way to respond to this crisis. This experience proved, yet again, the importance of human and humanized institutions in the form of commons, cooperatives, and commons-cooperative intersections to create a shared, collaborative and cooperative society.