Common ownership

Common ownership refers to holding the assets of an organization, enterprise, or community indivisibly rather than in the names of the individual members or groups of members as common property. Forms of common ownership exist in every economic system. Common ownership of the means of production is a central goal of socialist political movements as it is seen as a necessary democratic mechanism for the creation and continued function of a communist society. Advocates make a distinction between collective ownership and common property (the commons) as the former refers to property owned jointly by agreement of a set of colleagues, such as producer cooperatives, whereas the latter refers to assets that are completely open for access, such as a public park freely available to everyone.Public Ownership and Common Ownership, Anton Pannekoek, Western Socialist, 1947. Transcribed by Adam Buick.{{cite journal |title=Common Property in Anarcho-Capitalism |last=Holcombe |first=Randall G. |author-link=Randall G. Holcombe |volume=19 |issue=2 |year=2005 |pages=10 |journal=Journal of Libertarian Studies |url=https://www.mises.org/journals/jls/19_2/19_2_1.pdf |access-date=2014-09-13 |archive-date=2013-09-11 |archive-url=https://web.archive.org/web/20130911000224/http://mises.org/journals/jls/19_2/19_2_1.pdf |url-status=dead }}

Christian societies

The Early Church of Jerusalem shared all their money and possessions (Acts of the Apostles 2 and 4).{{Cite web|url=https://biblia.com/bible/nrsv/Acts%202|title=Acts 2:1–47|website=Biblia|access-date=2017-12-01}}{{Cite web|url=https://biblia.com/bible/nrsv/Acts%204|title=Acts 4:1–37|website=Biblia|access-date=2017-12-01}} Inspired by the early Christians, many Christians have since tried to follow their example of community of goods and common ownership.{{Cite news|url=https://www.theguardian.com/tv-and-radio/2019/jul/25/inside-the-bruderhof-review-is-this-a-religious-stirring-i-feel|title=Inside the Bruderhof review – is this a religious stirring I feel?|last=Mangan|first=Lucy|date=2019-07-25|work=The Guardian|access-date=2019-12-23|language=en-GB|issn=0261-3077}} Common ownership is practiced by some Christian groups, such as the Hutterites (for about 500 years), the Bruderhof Communities (for some 100 years), and others.{{Cite web|url=https://www.bbc.co.uk/mediacentre/mediapacks/inside-the-bruderhof|title=BBC - Inside The Bruderhof - Media Centre|website=www.bbc.co.uk|access-date=2019-10-10}}{{Cite news|url=https://www.ic.org/directory/bruderhof/|title=Bruderhof - Fellowship for Intentional Community|work=Fellowship for Intentional Community|access-date=2017-11-08|language=en-US}} In those cases, property is generally owned by a charity set up for the purpose of maintaining the members of the religious groups.{{Cite news|url=http://www.hutterites.org/history/community-of-goods/|title=Community Of Goods|date=2012-02-24|work=Hutterites|access-date=2017-12-01|language=en-US}}{{Cite web|url=http://www.eberhardarnold.com/|title=Eberhard Arnold: Founder of the Bruderhof|website=www.eberhardarnold.com|access-date=2017-12-01}} Christian communists typically regard biblical texts in Acts 2 and Acts 4 as evidence that the first Christians lived in a communist society.{{cite book |last=van Ree |first=Erik |url=https://books.google.com/books?id=dzesCQAAQBAJ&pg=PA10 |title=Boundaries of Utopia - Imagining Communism from Plato to Stalin |date=22 May 2015 |publisher=Routledge |isbn=978-1-134-48533-8 |via=Google Books}}{{cite journal |last=Walton |first=Steve |date=April 2008 |title=Primitive communism in Acts? Does Acts present the community of goods (2:44-45; 4:32-35) as mistaken? |journal=Evangelical Quarterly |volume=80 |pages=99–111 |doi=10.1163/27725472-08002001 |number=2}}{{cite book |last=Busky |first=Donald F. |url=https://books.google.com/books?id=O-bi65fwN7kC |title=Communism in History and Theory: From Utopian socialism to the fall of the Soviet Union |publisher=Greenwood Publishing Group |year=2002 |isbn=978-0-275-97748-1 |page=14 |author-link=Donald F. Busky |via=Google Books}} Additionally, the phrase "To each according to his needs" has a biblical basis in Acts 4:35, which says "to the emissaries to distribute to each according to his need".{{cite book |last=Baird |first=Joseph Arthur |title=The Greed Syndrome: An Ethical Sickness in American Capitalism |date=1989 |publisher=Hampshire Books |isbn=978-1877674020 |page=32}}{{cite book |last=Berman |first=Marshall |title=Adventures in Marxism |date=2000 |publisher=Verso Books |isbn=978-1859843093 |page=151 |author-link=Marshall Berman}}

In capitalist economies

Common ownership is practiced by large numbers of voluntary associations and non-profit organizations, as well as implicitly by all public bodies. While cooperatives generally align with collectivist and socialist economics, retailers' cooperatives in particular exhibit elements of common ownership, and their retailer members may be individually owned. Some individuals and organizations intentionally produce or support free content, including open source software, public domain works, and fair use media.{{cite web |url=http://freedomdefined.org/Definition |title=Definition of Free Cultural Works |version=1.1 |publisher=freedomdefined.org |author=Erik Möller, e.a. |author-link=Erik Möller |date=2008 |access-date=2015-04-20 |archive-date=18 August 2016 |archive-url=https://web.archive.org/web/20160818135549/http://freedomdefined.org/Definition |url-status=live }}{{cite web |url=https://www.gnu.org/philosophy/free-doc.html |title=Free Software and Free Manuals |access-date=March 22, 2009 |last=Stallman |first=Richard |author-link=Richard Stallman |date=November 13, 2008 |publisher=Free Software Foundation |archive-date=15 August 2021 |archive-url=https://web.archive.org/web/20210815064923/https://www.gnu.org/philosophy/free-doc.html |url-status=live }} Mutual aid is a form of common ownership that is practiced on small scales within capitalist economies, particularly among marginalized communities,{{cite book |last=NEMBHARD |first=JESSICA GORDON |url=https://www.jstor.org/stable/10.5325/j.ctv14gpc5r |title=Collective Courage: A History of African American Cooperative Economic Thought and Practice |date=2014 |publisher=Penn State University Press |isbn=978-0-271-06216-7 |doi=10.5325/j.ctv14gpc5r |jstor=10.5325/j.ctv14gpc5r}}{{cite journal |last1=Bacon |first1=Jacqueline |last2=McClish |first2=Glen |date=2000 |title=Reinventing the Master's Tools: Nineteenth-Century African-American Literary Societies of Philadelphia and Rhetorical Education |url=https://www.jstor.org/stable/3886116 |journal=Rhetoric Society Quarterly |volume=30 |issue=4 |pages=19–47 |doi=10.1080/02773940009391187 |issn=0277-3945 |jstor=3886116 |s2cid=144385631|url-access=subscription }}{{cite journal |last1=Williams |first1=Colin C. |last2=Windebank |first2=Jan |date=2000 |title=Self-help and Mutual Aid in Deprived Urban Neighbourhoods: Some Lessons from Southampton |url=https://www.jstor.org/stable/43084635 |journal=Urban Studies |volume=37 |issue=1 |pages=127–147 |doi=10.1080/0042098002320 |issn=0042-0980 |jstor=43084635 |bibcode=2000UrbSt..37..127W |s2cid=155040089|url-access=subscription }}{{cite journal |last1=Hernández-Plaza |first1=Sonia |last2=Alonso-Morillejo |first2=Enrique |last3=Pozo-Muñoz |first3=Carmen |date=2006 |title=Social Support Interventions in Migrant Populations |url=https://www.jstor.org/stable/23721354 |journal=The British Journal of Social Work |volume=36 |issue=7 |pages=1151–1169 |doi=10.1093/bjsw/bch396 |issn=0045-3102 |jstor=23721354|url-access=subscription }} and during emergencies such as the COVID-19 pandemic.{{cite book |last=Sitrin |first=Marina |title=Pandemic Solidarity: Mutual Aid during the Covid-19 Crisis |collaboration=Colectiva Sembrar |date=2020 |publisher=Pluto Press |isbn=978-0-7453-4316-7 |location=345 Archway Road, London N6 5AA |author-link=Marina Sitrin}}{{cite web |date=2020-05-14 |title='The way we get through this is together': mutual aid under coronavirus {{!}} Rebecca Solnit |url=http://www.theguardian.com/world/2020/may/14/mutual-aid-coronavirus-pandemic-rebecca-solnit |access-date=2020-06-14 |website=the Guardian |language=en}}{{cite news |title=Gig workers have created a tool to offer mutual aid during COVID-19 pandemic |work=TechCrunch |url=https://techcrunch.com/2020/03/18/gig-workers-collective-covid-19/ |access-date=21 March 2020}}{{cite magazine |last=Tolentino |first=Jia |author-link=Jia Tolentino |date=11 May 2020 |title=What Mutual Aid Can Do During a Pandemic |url=https://www.newyorker.com/magazine/2020/05/18/what-mutual-aid-can-do-during-a-pandemic |magazine=The New Yorker |location=United States |publisher=Condé Nast |access-date=28 July 2020}}

In socialist economies

Many socialist movements, including Marxist, anarchist, reformist, and communalist movements, advocate the common ownership of the means of production by all of society as an eventual goal to be achieved through the development of the productive forces, although many socialists classify socialism as public ownership or cooperative ownership of the means of production, reserving common ownership for what Karl Marx and Friedrich Engels termed "upper-stage communism",{{Cite journal|last=Marx|first=Karl|title=Critique of the Gotha Program|url=https://www.marxists.org/archive/marx/works/1875/gotha/ch01.htm|journal=Die Neue Zeit|volume=Bd. 1 No. 18|via=Marxist internet Archive}} or what other socialist theoreticians, such as Vladimir Lenin,{{cite book |last=Steele |first=David |title=From Marx to Mises: Post-Capitalist Society and the Challenge of Economic Calculation |publisher=Open Court Publishing Company |year=1992 |isbn=978-0-87548-449-5 |pages=44–45 |quote=By 1888, the term 'socialism' was in general use among Marxists, who had dropped 'communism', now considered an old fashioned term meaning the same as 'socialism'. ... At the turn of the century, Marxists called themselves socialists. ... The definition of socialism and communism as successive stages was introduced into Marxist theory by Lenin in 1917 ... , the new distinction was helpful to Lenin in defending his party against the traditional Marxist criticism that Russia was too backward for a socialist revolution.}} Emma Goldman,{{Cite web |last=Goldman |first=Emma |date=1932 |title=There Is No Communism in Russia |url=https://theanarchistlibrary.org/library/emma-goldman-there-is-no-communism-in-russia |access-date=2024-01-29 |website=The Anarchist Library |language=en}} and Peter Kropotkin,{{Cite web |last=Kropotkin |first=Pëtr |date=1901 |title=Communism and Anarchy |url=https://theanarchistlibrary.org/library/petr-kropotkin-communism-and-anarchy |access-date=2024-01-29 |website=The Anarchist Library |language=en}} simply termed "communism". From Marxist and anarchist analyses, a society based on a superabundance of goods and common ownership of the means of production would be devoid of classes based on ownership of productive property.{{Cite journal|last=Engels|first=Friedrich|date=Spring 1880|title=Socialism: Utopian and Scientific|url=https://www.marxists.org/archive/marx/works/1880/soc-utop/ch03.htm|journal=Revue Socialiste|via=Marxist Internet Archive}}

Common ownership in a hypothetical communist society is often distinguished from primitive communism, in that communist common ownership is the outcome of social and technological developments leading to post-scarcity and thus the elimination of material scarcity in society.{{Cite journal|last=Engels|first=Friedrich|title=The Principles of Communism|url=https://www.marxists.org/archive/marx/works/1847/11/prin-com.htm|journal=Vorwärts|via=Marxist Internet Archive}} From 1918 until 1995, the "common ownership of the means of production, distribution and exchange" was cited in Clause IV of its constitution as a goal of the British Labour Party and was quoted on the back of its membership cards. The clause read:

To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service.Adams, Ian (1998). Ideology and Politics in Britain Today (illustrated, reprint ed.). Manchester University Press. pp. 144–145. {{ISBN|9780719050565}}

Antitrust economics

In antitrust economics, common ownership describes a situation in which large investors own shares in several firms that compete within the same industry. As a result of this overlapping ownership, these firms may have reduced incentives to compete against each other because they internalize the profit-reducing effect that their competitive actions have on each other. The theory was first developed by Julio Rotemberg in 1984.{{Citation |last1=Rotemberg |first1=Julio |title=Financial Transaction Costs and Industrial Performance |work=MIT Sloan School of Management, Working Paper No. 1554-84 |year=1984}}. [https://dspace.mit.edu/bitstream/handle/1721.1/47993/financialtransac00rote.pdf] Several empirical contributions document the growing importance of common ownership and provide evidence to support the theory.{{Citation |last1=Azar |first1=José | last2=Schmalz |first2=Martin | last3=Tecu |first3=Isabel |year=2018 |title=Anticompetitive Effects of Common Ownership |journal=Journal of Finance |volume=73 |issue=4 |pages=1513–1565 |doi=10.1111/jofi.12698 |hdl=1721.1/49091 |s2cid=7965196 |hdl-access=free }} Because of concern about these anticompetitive effects, common ownership has "stimulated a major rethinking of antitrust enforcement".{{Citation |last1=Hemphill |first1=Scott |last2=Kahan |first2=Marcel |year=2020 |title=The Strategies of Anticompetitive Common Ownership |work=Yale Law Journal |pages=18–29}}. Several government departments and intergovernmental organizations, such as the United States Department of Justice,{{Citation |last1=Solomon |first1=Steven Davidoff |title=Rise of Institutional Investors Raises Questions of Collusion |work=New York Times |year=2018}}. [https://www.nytimes.com/2016/04/13/business/dealbook/rise-of-institutional-investors-raisesquestions-of-collusion.html] the Federal Trade Commission,{{Citation |last1=Federal Trade Commission |title=Competition and Consumer Protection in the 21st Century |work=FTC Hearings on Common Ownership |year=2018}}. [https://www.ftc.gov/system/files/documents/public_events/1422929/ftc_hearings_session_8_transcript_12-6-18_0.pdf] the European Commission,{{Citation |last1=OECD |title=Competition in Changing Times |work=DG COMP |year=2017}}. [https://ec.europa.eu/commission/commissioners/2014-2019/vestager/announcements/competition-changing-times-0_en] and the OECD,{{Citation |last1=Vestager |first1=Margrethe |title=Common Ownership by Institutional Investors and its Impact on Competition |work=Competition Committee |year=2018}}. [https://one.oecd.org/document/DAF/COMP(2017)10/en/pdf] have acknowledged concerns about the effects of common ownership on lessening product market competition.

Contract theory

Neoclassical economic theory analyzes common ownership using contract theory. According to the incomplete contracting approach pioneered by Oliver Hart and his co-authors, ownership matters because the owner of an asset has residual control rights.{{Cite journal|last1=Grossman|first1=Sanford J.|last2=Hart|first2=Oliver D.|date=1986|title=The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration|journal=Journal of Political Economy|volume=94|issue=4|pages=691–719|doi=10.1086/261404|jstor=1833199|hdl=1721.1/63378|url=http://dspace.mit.edu/bitstream/1721.1/63378/1/costsbenefitsofo00gros.pdf}}{{Cite journal|last1=Hart|first1=Oliver|last2=Moore|first2=John|date=1990|title=Property Rights and the Nature of the Firm|journal=Journal of Political Economy|volume=98|issue=6|pages=1119–1158|doi=10.1086/261729|jstor=2937753|citeseerx=10.1.1.472.9089}} This means that the owner can decide what to do with the asset in every contingency not covered by a contract. In particular, an owner has stronger incentives to make relationship-specific investments than a non-owner, so ownership can ameliorate the hold-up problem. As a result, ownership is a scarce resource (i.e. there are limits to how much they can invest) that should not be wasted. In particular, a central result of the property rights approach says that joint ownership is suboptimal.{{Cite book|title=Firms, contracts, and financial structure|last=Hart|first=Oliver|publisher=Oxford University Press|year=1995}} If there is a start with joint ownership (where each party has veto power over the use of the asset) and move to a situation in which there is a single owner, the investment incentives of the new owner are improved while the investment incentives of the other parties remain the same; however, in the basic incomplete contracting framework, the suboptimal aspect of joint ownership holds only if the investments are in human capital while joint ownership can be optimal if the investments are in physical capital.{{Cite journal|last=Schmitz|first=Patrick W.|date=2013|title=Investments in physical capital, relationship-specificity, and the property rights approach|journal=Economics Letters|volume=119|issue=3|pages=336–339|doi=10.1016/j.econlet.2013.03.017|url=https://mpra.ub.uni-muenchen.de/45243/1/MPRA_paper_45243.pdf}} Several authors have shown that joint ownership can actually be optimal even if investments are in human capital.{{Cite journal|last1=Gattai|first1=Valeria|last2=Natale|first2=Piergiovanna|date=2015|title=A New Cinderella Story: Joint Ventures and the Property Rights Theory of the Firm|journal=Journal of Economic Surveys|volume=31|language=en|pages=281–302|doi=10.1111/joes.12135|issn=1467-6419}} In particular, joint ownership can be optimal if the parties are asymmetrically informed,{{Cite journal|last=Schmitz|first=Patrick W.|date=2008|title=Joint ownership and the hold-up problem under asymmetric information|journal=Economics Letters|volume=99|issue=3|pages=577–580|doi=10.1016/j.econlet.2007.10.008}} if there is a long-term relationship between the parties,{{Cite journal|last=Halonen|first=Maija|date=2002|title=Reputation and the Allocation of Ownership|journal=The Economic Journal|volume=112|issue=481|pages=539–558|doi=10.1111/1468-0297.00729|jstor=798519|url=http://eprints.lse.ac.uk/19365/1/Reputation_and_Allocation_of_Ownership.pdf|citeseerx=10.1.1.11.8312}} or if the parties have know-how that they may disclose.{{Cite journal|last1=Rosenkranz|first1=Stephanie|last2=Schmitz|first2=Patrick W.|date=2003|title=Optimal allocation of ownership rights in dynamic R&D alliances|journal=Games and Economic Behavior|volume=43|issue=1|pages=153–173|doi=10.1016/S0899-8256(02)00553-5}}

References

External links

[http://www.iansnaith.com/wp-content/blogs.dir/8/files/2013/02/coop-advantage.pdf The Co-operative Advantage - Creating a successful family of Co-operative businesses. The Report of the Co-operative Commission January 2001]. The Co-operative Commission was established by British prime minister Tony Blair in 2000 and recommended that A modernizing bill should be put before Parliament to recognize in law the Co-operative form of common ownership. (recommendation 51).
Frank H. Stephen (1984) The Economic Analysis of Producers' Cooperatives London:Macmillan, {{ISBN|978-1-349-06250-8}}, p. 145

Category:Economic systems

Category:Anarchist theory

Category:Socialism

Category:Property