University of Wisconsin Center for Cooperatives
Journal of Agricultural Cooperation
ClASSIC REVIEW
 

Title Cooperative Principles and Equity Financing: A Discussion of Critical Discussion
Author(s) Michael L. Cook
Series Volume 7
Issue Date 1992
Abstract Royer's paper explores hypothesized impacts of the "principles of cooperation" on the current practices of voting, equity acquisition, and equity redemption in U.S. agricultural cooperatives. The author argues that practicing traditional cooperative principles may lead to an increasingly incompatible conflict between the investor-owned role, the user-owner role, and the user-patron role of a cooperative member. The author examines inconsistencies and inequities among alternative cooperative philosophies and practices. Subsequently, he concludes that he has found the solution - proportionality - a concept that calls for the degree of control and benefits derived from an agricultural cooperative by a member to be directly related (proportional) to the amount of risk incurred by the member in the form of equity provided.

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