European Cooperative Movement - Background and Common Denominators

Influenced by the legacy of command economies, the recent agricultural cooperation in Central and Eastern Europe is, compared to EU countries, marked by a different pattern. Based on simplified ownership incentive approach, this paper distinguishes between the fundamental features of communist, post-communist and democratic cooperatives. While in most Central and Eastern Europe there are more production cooperatives than marketing / supplying (secondary) cooperatives, in EU countries the ratio is reversed in favour of the secondary cooperatives. The more common utilisation of secondary cooperatives that enable a vertical integration might be one of many reasons for more competitive agricultural sector in the EU. Based on circumstantial historical evidence, and the influence of internal and external factors, this paper identifies three common steps that form pre-requisites to a successful cooperative development. The paper closes with noting that these three steps might not be directly applicable to the CEEC situation