Meso-level economics and cooperatives

As I have mentioned in previous posts, I am spending a portion of my summer interning with the Valley Alliance of Worker Cooperatives, a local organization of worker owned enterprises and a few consumer cooperatives too. My task is to help outline an internship program and being involved with this organization has been, so far, a very eye-opening foray into the cooperative world.

The first observation about cooperative business is that this is a movement, not just a business structure like LLC or Inc. As I read more about the movement in the U.S., as well as the much larger cooperative economies in Italy and Spain, the idea of "meso-level economics" or "mesoeconomics" comes up quite often. Mind you, this word is nowhere present in the common economics introductory and intermediate level textbooks or curricula, although if you read in depth into Schumpeter it comes up. Here is the less than information wiki entry on mesoeconomics. Here's a paper on the origins of mesoeconomics.

The idea of mesoeconomics is that there is another level of organizing or transaction or dynamic that takes place somewhere between microeconomics (consumer and the firm) and the macroeconomy (GDP, fiscal and monetary policies). An example of a "meso-level" economic entity, in the cooperative setting, would be that of the Valley Alliance, in that it is a regional grouping of microeconomic actors (coops). Mesoeconomics could also be talking about different sectors, geographies, incentive effects, supply chains, etc. It's complicated, undefined, and I certainly haven't read enough yet to really explain anything.

In regards to building a cooperative economy, meso-level thinking is important when trying to encourage cooperation between cooperatives. An group like the Valley Alliance serves to connect coops together, encourage coops (especially those in different product/service sectors) to inter-cooperate, and also to collectively work towards financing options, health-care plans, retirements, and cooperative investment activities, preferably through other coops or coop-related organizations.

Since coops are a movement, the mesoeconomic activity serves as a means for influencing the culture, education, and laws that can help to build the great cooperative economy. In the Valley Alliance example, the organization can help to lobby for more coop friendly laws (like allowing a consortia to purchase pooled health insurance), team up with educators to teach about co-opreneurship (like UMass), and to socially connect coops and the community.

There are of course many obstacles and constraints acting on this kind of organizing. Funding and man-power are scarce resources, and minuscule in comparison to the rest of the capitalist based economy, however even the smallest seed can become a tree someday, so I'd like to think that when a small organization of coops begins "seeding" intercooperative investment and support, it can grow to someday be a full-scale mesoeconomic actor in building the larger cooperative economy (...macroeconomics!).

I'd like to know more about mesoeconomic theory, in both the mainstream and cooperative sense, so I'll be snooping around for more books and papers. I know that the idea isn't well-received, but mainstream economists should reconsider rebuilding "the model" to include this level of organizing. A few weeks back, Nancy Folbre talked about "new economics" in her blog post, and last week there was another post that talked about another take on "new economics" using models from seismology (which eerily reminds me of the marginalists and thermodynamics).

The need to rethink is apparent and obvious. Physical, biological, and social systems work on several levels, so maybe it's time to reconsider how we look at the levels of economics.And while we're at it, cooperation sounds a lot more fun than competition.

That's enough of my humble student ramblings for now.