Transcript Defining the Social Economy - Green Economist

Defining the Social Economy
Theory of the Social Economy
Module BAM450
Structure of the presentation
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Legal EU definition
Brief history of development
Outline of three competing definitions
Moving forward: social enterprise or an
economy of solidarity?
The formal EU definition
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Since 1989 the social economy has
been the responsibility of the
Commission’s Employment and Social
Affairs DG which defines it as including:
Cooperatives
Mutuals
Associations
Foundations
Vaguely analagous alternative
terms for the social economy:
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Non-profit sector: cannot make profits
Not-for-profit sector: can make profits
but not primary motivation
Solidarity economy: in support of the
poor, e.g. fair trade
Alternative economy: motivated by, e.g.
concern for the environment
Third system [otherwise: third sector]
History and background of the
term
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French term ‘economie sociale’ first
used by Charles Dunoyer in 1830 in his
paper called ‘Nouveau traité d’économie
sociale’.
This was a paternalistic notion based in
a Catholic attempt to counteract class
conflict
 (Westlund, 2003).
What was happening in Paris
in 1830?
Anthropology of human
societies
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Side by side with family housekeeping, there
have been three principles of production and
distribution:
Reciprocity
Redistribution
Market
Prior to the market revolution, humanity’s
economic relations were subordinate to the
social. Now economic relations are now
generally superior to social ones.
Root of social economy in
workers’ movements
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Various traditions--socialist, Christian, liberal (Owen,
Saint-Simon, Fourier, Proudhon).
Context was industrialization, proletarianization and
pauperization
Multifunctional associations aiming to create a microsocial space of solidarity and to step in as actors in
the area of economic organization, both at the level
of production and at the level of distribution.
Made some use of traditional types of solidarity
(families, corporations), but grounded in principles of
liberty and equality between members.
 (Nyssens, 1997: 178-9).
Social economy as the ‘third
way’
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‘In the conflict between capitalism and socialism
which characterized twentieth century Europe, the
social economy became a "third" way.’ (Westlund,
2003: 1193).
State involvement in social services ended the
multifunctionality of the third sector.
mutual benefit societies specialized in social
protection
cooperatives confined their activities to consumption
trade unions turned to the ‘workers’ struggle’.
Dissociation between the economic (the sphere of
the market) and the social (the sphere of the state).
(Nyssens, 1997: 179).
Nyssens’ definition
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Essentially seeing the social economy as
filling gaps left by the private and public
sectors
Generates three poles of economic
activity
Evolution of social economy in
three stages
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2.
3.
Network-based associations with various
functions arising to solve specific problems,
with both an economic and a political
identity.
Integration into a modernization project
that favoured the market-state synergy:
marginalization.
A revitalization following the crisis of the
market-state relationship
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In the South, the popular economy turns out
to be not only a means of survival in the face
of economic adversity, but also a means of
political, social and cultural resistance,
particularly via a rekindling of the associative
flame. . . In the North, the burgeoning of
nonprofit organizations producing goods and
services at the community levels appears as a
particular response to the crisis in
employment and the welfare state
Westlund’s definition
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Revolves around the nature of relationships
‘Reciprocity can be described in terms of
give-and-take in a relationship between
actors who, to a certain extent are equals. . .
Mutuality is often used as a synonym for
reciprocity. . . Reciprocity of social relations
creates mutuality of economic relations, but
mutuality in economic transactions is no
guarantee of reciprocity in social relations.’
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Like the family economy the social economy is based
on reciprocity; unlike the family economy kinship is
not involved;
The market economy and public sector are based on
monetary exchange; the social economy is not;
The public sector is based on official legislation,
whereas the social economy is based on commonality
of interests and values;
The market economy and public sector are based
primarily on material capital whereas the social
economy is based primarily on social capital.
Pearce’s definition
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Complex and based on 'systems‘
It attempts to include all the different
types of organization that exist in a
modern economy, which is a strength as
well as a weakness
Inclusion of the level, from local to
global, is useful
It does not deal adequately with coops
WIRC definition
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A pragmatic, operational definition
Our defining scalpels are ownership and
control
The following dimensions are significant:
Ownership
Control
Values
Product
Source of finance
Ownership
Control
Product
Finance
Values
Tower Colliery
Workers
Workers/ma
nagement
Economic
Employees
/private
Mutualistic
OMSCO
(organic milk
suppliers’
cooperative)
Joint/workers
?
Economic
Private/
members
Mutualistic
(organic)
Local ESOP?
Worker/shareh
olders
Managers
Economic
Employees
/private
Market
Glas Cymru
Trust?
Managers
Public good
Private
Mutualistic?
No
Community
enterprise
Workers
Employees?
Committee?
Social
Public
Mutualistic
Newtown
Credit Union
Members
Members
Financial
Members
Mutualistic
Foundation
hospital
State?
Members
Social
Public
Market?
Ty Hafan
children’s
hospice
Non-profit
Managers
Social
Charitable
Philanthropic
The future? Social enterprise
or an economy of solidarity?
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Social enterprise originated in the US
A form of mutual activity acceptable
within a market economy?
A useful tool for politicians wishing to
reduce the role of the state? E.g. ‘social’
housing
Social enterprise
referring to market-oriented economic
activities serving a social goal. The
social enterprise is then viewed as an
innovative response to the funding
problems of non-profit organizations,
which are finding it increasingly difficult
to solicit private donations and
government and foundation grants.
(Defourney and Nyssens, 2006).
Criteria for a ‘social enterprise’
pace WISE
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A continuous activity, producing and selling goods and/or
services
A high degree of autonomy
A significant level of economic risk
A minimum amount of paid work
An explicit aim to benefit the community
An initiative launched by a group of citizens
Decision-making power not based on capital ownership
A partipatory nature, which involves the various parties
affected by the activity
Limited profit distribution
An economy of solidarity?
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The projects of an economy of solidarity have
a tendency to reunite that which has long
been separated and to question some
presuppositions of the market-state synergy:
the separation between the economic and the
social, the sharp dividing line between paid
work and leisure, the state’s monopoly on
solidarity, the market-state dichotomy, and so
on.
Characteristics
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Bottom-up—what we might have called
mutualism
Anti-capitalist? At least antiglobalisation
Importance of the local—level of control
Reduction of consumption and respect
for the planet—a partially new concern
An economy of emancipation
and co-operation
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Why produce only as a function of an unjust market
that depletes and exploits, denying us the chance to
manage both the production and the economy for
our own service, for the service of all citizens, and of
all peoples of the planet, as well as for future
generations? Our proposal is a socioeconomy of
solidarity as a way of life that encompasses the
totality of the human being, that announces a new
culture and a new form of producing to fulfill the
needs of each human being and of the entire
humanity.