Hostname: page-component-586b7cd67f-rdxmf Total loading time: 0 Render date: 2024-11-22T18:50:44.944Z Has data issue: false hasContentIssue false
  • English
  • Français

The stakeholder-empowering philanthropy of Edward Filene

Published online by Cambridge University Press:  29 October 2019

Keith Taylor  and
Nathan P. Goodman
Keith Taylor
Affiliation:
Department of Human Ecology, University of California, Davis, CA, 95616
Nathan P. Goodman*
Affiliation:
Department of Economics, George Mason University, Fairfax, VA, 22030
*
*Corresponding author. Email: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

Credit unions currently serve over 110 million members in the United States. This is surprising, given the challenges associated with forming cooperatives. This paper explains how grants were used to overcome these challenges and create the modern credit union sector. Edward Filene, a wealthy 20th-century department store owner, provided philanthropic funding and technical expertise to early credit unions, resulting directly in the creation of 26,000 American credit unions over a 45-year period. Filene's leadership helped overcome the various social dilemmas associated with creating cooperatives, reforming institutions, and establishing an institutional framework that enables and supports cooperatives.

Keywords

Cooperativesself-governancecollective action problemsconsumer cooperativesgrants
Type
Symposium on Institutional Analysis and the Gift
Information
Journal of Institutional Economics , Volume 16 , Issue 5 , October 2020 , pp. 715 - 729
Copyright
Copyright © Millennium Economics Ltd 2019

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Achen, C. H. and Bartels, L. M. (2017), Democracy for Realists: Why Elections Do Not Produce Responsive Government (Vol. 4), Princeton, NJ: Princeton University Press.Google Scholar
Acs, Z. J., Phillips, R. J., Audretsch, D. B. and Desai, S. (2008), ‘Non-Market Sources of American Entrepreneurial Capitalism’, in Schockley, G. E., Frank, P. M. and Stough, R. R. (eds), Non-market Entrepreneurship: Interdisciplinary Approaches, Cheltenham, UK: Edward Elgar.Google Scholar
Aligica, P. D. (2018), Public Entrepreneurship, Citizenship, and Self-Governance, Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Andreoni, J. (1990), ‘Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving’, Economic Journal, 100(401): 464–477.CrossRefGoogle Scholar
Andreoni, J. (1998), ‘Toward a Theory of Charitable Fund-Raising’, Journal of Political Economy, 106(6): 1186–1213.CrossRefGoogle Scholar
Andreoni, J. (2006), ‘Leadership Giving in Charitable Fund-Raising’, Journal of Public Economic Theory, 8(1): 1–22.CrossRefGoogle Scholar
Anon. (2019), ‘Conversions to Cooperative and Business Transition’, Democracy at Work Institute, available at https://institute.coop/projects/conversions (accessed 12 July 2019).Google Scholar
Anon. (n.d.), ‘Credit Union Payments & Financial Technology Company’, Co-op Financial Services, available at https://www.co-opfs.org/ (accessed 16 July 2019).Google Scholar
Arcidiacono, D. (2018), ‘Promises and Failures of the Cooperative Food Retail System in Italy’, Social Sciences, 7(11): 232.CrossRefGoogle Scholar
Bates, R. H., Grief, A., Levi, M., Rosenthal, J., and Weingast, B. (1998), Analytic Narratives, Princeton, NJ: Princeton University Press.Google Scholar
Bergengren, R. F. (1952), Crusade: The Fight for Economic Democracy in North America, 1921–1945, New York: Exposition Press.Google Scholar
Besley, T. and Case, A. (1995), ‘Incumbent Behavior: Vote-Seeking, Tax Setting, and Yardstick Competition’, American Economic Review, 85(1): 25–45.Google Scholar
Boettke, P. J. and Aligica, P. D. (2009), Challenging Institutional Analysis and Development: The Bloomington School, New York: Routledge.Google Scholar
Boettke, P. J., Coyne, C. J., and Leeson, P. T. (2011), ‘Quasimarket Failure’, Public Choice, 149: 209–224.CrossRefGoogle Scholar
Boulding., K. E. (1969), ‘Public Choice and the Grants Economy: The Intersecting Set’, Public Choice, 7(1): 1–2.CrossRefGoogle Scholar
Boulding, K. E. (1973), The Economy of Love and Fear: A Preface to Grants Economics, Belmont, CA: Wadsworth.Google Scholar
Boulding, K. E., Pfaff, M. and Horvath, J. (1972), ‘Grants Economics: A Simple Introduction’, American Economist, 16(1), 19–28.CrossRefGoogle Scholar
Brennan, J. (2016), Against Democracy, Princeton: Princeton University Press.Google Scholar
Bubb, R. and Kaufman, A. (2013), ‘Consumer Biases and Mutual Ownership’, Journal of Public Economics, 105: 39–57.CrossRefGoogle Scholar
Caplan, B. (2007), The Myth of the Rational Voter: Why Democracies Choose Bad Policies, Princeton, NJ: Princeton University Press.Google Scholar
Chamlee-Wright, E. and Storr, V. H. (2011), ‘Social Capital as Collective Narratives and Post-Disaster Community Recover’, Sociological Review, 59(2): 266–282.CrossRefGoogle Scholar
Chatterji, A., Luo, J. and Seamans, R. C. (2015), ‘Banks vs. Credit Unions after the Financial Crisis’, Academy of Management Proceedings, 1: 15855.CrossRefGoogle Scholar
Chong, D. (1991), Collective Action and the Civil Rights Movement, Chicago: University of Chicago Press.CrossRefGoogle Scholar
Coase, R. H. (1937), ‘The Nature of the Firm’, Economica, 4(16): 386–405.CrossRefGoogle Scholar
Cook, M. (2018), ‘A Life Cycle Explanation of Cooperative Longevity’, Sustainability, 10(5): 1586, available at http://www.mdpi.com/2071-1050/10/5/1586 (accessed 21 September 2019).CrossRefGoogle Scholar
Cornforth, C. and Thomas, A.. (1990), ‘Cooperative Development: Barriers, Support Structures and Cultural Factors’, Economic and Industrial Democracy, 11(4):451–461.CrossRefGoogle Scholar
Cox, M., Arnold, G., and Tomás, S. V.. (2010), ‘A Review of Design Principles for Community-Based Natural Resource Management’, Ecology and Society, 15(4): 38.CrossRefGoogle Scholar
Coyne, C. J. and Hall, A. (2013), ‘Anarchy, Philanthropy, and the Provision of Public Goods in a Free Society’, Spanda Journal, 4(1): 25–36.Google Scholar
Cracogna, D., Fici, A., and Henrÿ, H. (eds) (2013), International Handbook of Cooperative Law, Heidelberg, New York, Dordrecht, London: Springer.CrossRefGoogle Scholar
Craig, A. W. and Goodman, N. (2019), ‘Social Capital and Social Justice: Why Liberalism is Essential’, Journal of Private Enterprise, 34(1): 59–73.Google Scholar
Eisenhardt, K. M., & Graebner, M. E. (2007), ‘Theory Building from Cases: Opportunities and Challenges’, Academy of Management Journal, 50(1): 25–32.CrossRefGoogle Scholar
Engelbourg, S. (1976), ‘Edward A. Filene: Merchant, Civic Leader, and Jew’, American Jewish Historical Quarterly, 66(1): 106.Google Scholar
Filene, E. A. (2018), Speaking of Change: A Selection of Speeches and Articles, New Zealand: Sagwan Press.Google Scholar
Fried, H. O., Lovell, C. A. K. and Eeckaut, P. V. (1993), ‘Evaluating the Performance of US Credit Unions’, Journal of Banking and Finance, 17(2–3): 251–265.CrossRefGoogle Scholar
Furubotn, E. G. and Pejovich, S. (1970), ‘Property Rights and the Behaviour of the Firm in a Socialist State: The Example of Yugoslavia’, Zeitschrift für Nationalökonomie, 30(3–4): 431–454.CrossRefGoogle Scholar
Gerring, J. (2007), Case Study Research: Principles and Practices, New York, NY: Cambridge University Press.Google Scholar
Giles, R. Y. (1951), Credit for the Millions: The Story of Credit Unions, New York: Harper.Google Scholar
Giridharadas, A. (2018), Winners Take All: The Elite Charade of Changing the World, New York: Knopf.Google Scholar
Hansmann, H. (1996), The Ownership of Enterprise, Cambridge, MA: Harvard University Press.Google Scholar
Hargadon, A. (2003), How Breakthroughs Happen: The Surprising Truth about How Companies Innovate, Boston: Harvard Business School Press.Google Scholar
Hirschman, A. O. (1970), Exit, Voice, and Loyalty, Cambridge, MA: Harvard University Press.Google Scholar
INCITE! (2017), The Revolution Will Not Be Funded, Durham, NC: Duke University Press.Google Scholar
Johnson, G. W. (1948), Liberal's Progress, New York: Coward-McCowan.Google Scholar
King, G., Keohane, R. O. and Verba, S. (1994), Designing Social Inquiry: Scientific Inference in Qualitative Research, Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Kohl-Arenas, E. (2015), The Self-Help Myth: How Philanthropy Fails to Alleviate Poverty, Berkeley, CA: University of California Press.CrossRefGoogle Scholar
Lin, N. (2001), Social Capital: A Theory of Social Structure and Action, New York: Cambridge University Press.Google Scholar
Little, K. S. (1937), ‘A Credit Union Head Tells of Expansion’, Deseret News, available at https://news.google.com/newspapers?id=IckbAAAAIBAJ&sjid=-FUEAAAAIBAJ&pg=4841,5141228&dq=roy-bergengren&hl=en (accessed 2 October 2019).Google Scholar
Loury, G. (1977), ‘A Dynamic Theory of Racial Income Differences’, in Wallace, P. and LaMond, A. (eds), Women, Minorities, and Employment Discrimination, Lexington, MA: Lexington Books.Google Scholar
McKillop, D. and Wilson, J. O. S. (2011), ‘Credit Unions: A Theoretical and Empirical Overview’, Financial Markets, Institutions & Instruments, 20(3): 79–123.CrossRefGoogle Scholar
McQuaid, K. (1976), ‘An American Owenite: Edward A. Filene and the Parameters of Industrial Reform, 1890–1937’, American Journal of Economics and Sociology, 35(1): 77–94.CrossRefGoogle Scholar
Mikami, K. (2010), ‘Capital Procurement of a Consumer Cooperative: Role of the Membership Market’, Economic Systems, 34(2):178–197.CrossRefGoogle Scholar
Mikami, K. (2018), ‘Are Cooperative Firms a Less Competitive Form of Business? Production Efficiency and Financial Viability of Cooperative Firms with Tradable Membership Shares’, Economic Systems, 42(3): 487–502. http://dx.doi.org/10.1016/j.ecosys.2017.11.005CrossRefGoogle Scholar
Molk, P. (2014), ‘The Puzzling Lack of Cooperatives’, Tulane Law Review, 88(5): 899–958.Google Scholar
Moody, J. C. and Fite, G. C. (1984), The Credit Union Movement: Origins and Development, 1850–1980, Lincoln, NE: University of Nebraska Press.Google Scholar
Mooney, P. H. (2004), ‘Democratizing Rural Economy: Institutional Friction, Sustainable Struggle and the Cooperative Movement’, Rural Sociology, 69(1):76–98.CrossRefGoogle Scholar
National Credit Union Administration (2019), Quarterly Credit Union Data Summary: 2019 Q1. Alexandria, VA: National Credit Union Administration, available at at https://www.ncua.gov/files/publications/analysis/quarterly-data-summary-2019-Q1.pdf (accessed 18 September 2019).Google Scholar
Olson, M. (1965), The Logic of Collective Action, Cambridge, MA: Harvard University Press.Google Scholar
Olson, M. (1982), The Rise and Decline of Nations, New Haven: Yale University Press.Google Scholar
Ostrom, E. (1990), Governing the Commons: The Evolution of Institutions for Collective Action, Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Ostrom, V. (1991), The Meaning of Democracy and the Vulnerability of Democracies: A Response to Tocqueville's Challenge, Ann Arbor, MI: University of Michigan Press.Google Scholar
Ostrom, E. (1994), Neither Market Nor State: Governance of Common-Pool Resources in the Twenty-First Century. Washington, DC: International Food Policy Research Institute.Google Scholar
Ostrom, E. (2000), ‘Collective Action and the Evolution of Social Norms’, Journal of Economic Perspectives, 14(3): 137–158.CrossRefGoogle Scholar
Ostrom, E. (2005), Understanding Institutional Diversity, Princeton, NJ: Princeton University Press.Google Scholar
Ostrom, E. and Walker, J. (eds) (2003), Trust and Reciprocity: Interdisciplinary Lessons for Experimental Research, New York: Russell Sage Foundation.Google Scholar
Pilcher, J. (2012), ‘Credit Union Industry Outlook: 5 Years Back, 20 Years Forward’, The Financial Brand, available at https://thefinancialbrand.com/24943/credit-union-industry-outlook/ (accessed January 18, 2019).Google Scholar
Reich, R. (2013), ‘What Are Foundations For?’ Boston Review, March/April: 10–14.Google Scholar
Reich, R. (2018), Just Giving: Why Philanthropy is Failing Democracy and How It Can Do Better, Princeton, NJ: Princeton University Press.Google Scholar
Sadowski, B. M. (2017), ‘Consumer Cooperatives as an Alternative Form of Governance: The Case of the Broadband Industry’, Economic Systems, 41(1): 86–97.Google Scholar
Shughart, W. F. and Thomas, D. W. (2014), ‘What Did Economists Do? Euvoluntary, Voluntary, and Coercive Institutions for Collective Action’, Southern Economic Journal, 80(4): 926–937.CrossRefGoogle Scholar
Skarbek, E. (2016), ‘Aid, Ethics, and the Samaritan's Dilemma: Strategic Courage in Constitutional Entrepreneurship’, Journal of Institutional Economics, 12(2): 371–393.CrossRefGoogle Scholar
Somin, I. (2013), Democracy and Political Ignorance: Why Smaller Government is Smarter, Stanford, CA: Stanford University Press.Google Scholar
Taylor, K. (2019), Governing the Wind Energy Commons: Rural Energy and Community Development, Morgantown, WV: Western Virginia University Press.Google Scholar
Tellis, W. M. (1997) ‘Introduction to Case Study’, Qualitative Report, 3(2): 1–14.Google Scholar