Are cooperatives more productive than investor-owned firms? Cross-industry evidence from portugal

• Published in: Annals of public and cooperative economics Vol. 89; no. 2; pp. 377 - 413
• Main Authors: Monteiro, Natália P., Straume, Odd Rune
• Format: Journal Article
• Language: English
• Published: Oxford Wiley 01-06-2018; Blackwell Publishing Ltd
• Subjects: Business ownership; Ciências Sociais; Companies; Cooperatives; D24; Economia e Gestão; Efficiency; Investors; investor‐owned firms; J54; Minority set aside programs; P12; P13; Panel data; productive efficiency; Productivity; Social Sciences; Portugal
• ISSN: 1370-4788; 1467-8292
• DOI: 10.1111/apce.12201

We analyse empirically whether cooperatives and investor-owned firms differ in terms of productive efficiency. Using rich Portuguese panel data covering a wide range of industries, we apply two different empirical approaches to estimate potential differences in productive efficiency. The results from our benchmark random-effects model show that cooperatives are significantly less productive, on average, than investor-owned firms, both at the aggregate level and for most of the industries considered. However, the results derived from a System-GMM approach, which is our preferred empirical strategy, are much less conclusive, and we cannot conclude that cooperatives are generally less efficient that investor-owned firms. With either approach, though, we find no evidence that cooperatives are more productive than investor-owned firms in any industry.
We thank an anonymous referee and a co-editor for valuable comments and suggestions. This work was carried out with funding from COMPETE reference no. POCI-01-0145-FEDER-006683, with the FCT/MEC's financial support through national funding and by the ERDF through the Operational Programme on Competitiveness and Internationalization COMPETE 2020 under the PT2020 Partnership Agreement.