The importance of co-operatives to the New Zealand economy

Abstract

PurposeThe purpose of this paper is to measure the size of New Zealand’s co-operative sector, in terms of its direct contribution to output and employment as well as its indirect impact. This adds to the construction of a rigorous representation of the global co-operative economy.Design/methodology/approachThe findings here are based on data derived largely from surveying the co-operative sector in 2012. A value added approach is used to estimate the co-ops sector’s contribution to New Zealand’s GNP.FindingsThe author estimates suggest that the cooperative sector is much larger, even in its direct impact on the economy, than the prior estimates indicate.Research limitations/implicationsAssumptions were made on the size contribution of missing firms and the value added contribution of co-ops. These assumptions need to be interrogated and improved upon, albeit the assumptions are designed to generate lower bound size estimates.Practical implicationsThe methodology adopted in this paper can be used to develop more rigorous estimates of the size of the co-op sector globally.Social implicationsThe results empirically challenge the worldview of conventional economics that co-ops are not economically sustainable, where co-ops offer a more equitable and democratic mode for production and development.Originality/valueThis paper presents revised, relatively robust, and methodologically transparent estimates of the size of New Zealand’s co-operative sector. These estimates suggest a much larger sector than previously thought. The methodology developed here can contribute to developing more robust estimates of the size of the co-op sector globally.