[nradov]

Worker cooperatives are legal and there are some around today. There's nothing stopping workers from owning the fruits of their own labor. Yet most workers choose not to join or start cooperatives, and instead prefer wage labor. Why is that?

It seems that most workers prioritize a steady wage without the risk of being an owner. And it's difficult for worker cooperatives in capital-intensive industries to attract outside investors; investors who put in significant amounts of money quite rationally want some control over the enterprise rather than leaving the decisions up to workers.

One of the most prominent examples of employee ownership was with United Airlines. Employees gained majority ownership in 1994. That kind of worked for a while but ultimately failed, ironically partly due to labor union disputes. It seems the workers had trouble deciding how to share the fruits of their labor.

[mgrthrow]

It is orders of magnitude more challenging to found a co-op. Let alone get enough capital to get started.

We've set up our society to make it difficult for worker owned businesses.

[dicethrowaway1]

A good elaboration of this point is Greg Dow's "Governing the Firm" and "The Labor-Managed Firm".

In short, worker-owned businesses are rare because individual workers are poor (relative to the capital that's needed) and they can't get external funding because the investors want control in return, which labor management can't provide.

That's why most large-scale worker-owned businesses are part of a federation supported by a bank - e.g. Mondragon's Caja Laboral. Institutional design indeed does matter.

[mgrthrow]

Funding is a huge part, for sure, but also getting incorporated. Talk to a lawyer and your state about founding an LLC or sole proprietorship. Ezpz. Done in an hour.

Talk about founding a workers co-op that's democratically run? With shares issued to each worker? There's just no template for it. It's days of work to get it over the line.