State Formation, Ideological Competition, and the Ecology of Israeli Workers' Cooperatives, 1920–1992

Abstract

We investigate the effect of community-wide political and ideological interests on the failure rate of Israeli workers' cooperatives. Political order may be provided by the state or through membership in a federation. Independently, both conditions should reduce organizational failure, but when they coexist, the influence of the state should dominate due to its comparative advantages as a supplier of order. Organizations that represent rival ideologies cause ideological competition, which should increase failure, while organizations that represent shared ideologies cause ideological mutualism, which should decrease failure. The context of Israeli workers' cooperatives provides a natural laboratory for testing these ideas, as it spans the formation of the Israeli state. It also includes a powerful federation, the Histadrut, to which many cooperatives belonged, as well as significant populations of organizations representing both capitalist and socialist ideologies. The analysis supports all of the above arguments, indicating the relevance of interdependence, broadly defined, for the evolution of organizational populations.