Consumer cooperatives as a new governance form : the case of the cooperatives in the broadband industry

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Since Williamson’s semi-final paper (1975) on governance forms in a market economy, a growing number of studies have focused on new forms of governance, but research seems to have neglected consumer cooperatives despite their growing importance in some sectors of the economy. With an increasing emergence of consumer cooperatives in industries such as electricity generation or broadband telecommunications, however, there is a need to study the specific structure and function of consumer cooperatives in the market economy. In the literature, the growth of consumer cooperatives has been attributed to problems of market failure in conjunction with high risk and uncertain investment. In order to examine incentives for consumers to join a consumer cooperative, we make a distinction between different types of risks and benefits. The evolution of broadband markets in the Netherlands provides an interesting example to examine the function and structure of local cooperatives in a dynamic market. In the paper, we analyze the incentives of 759 consumers to opt in favor of setting up of a cooperative aimed at providing broadband services via a fiber network. We found that the risks associated with creating cost-efficiencies and switching cost are important determinants for consumers to join a cooperative. In addition, benefits expected from consumers with respect to user network externalities and indirect gains derived will affect the probability of consumers to join a cooperative.
Originele taal-2Engels
Plaats van productieEindhoven
UitgeverijTechnische Universiteit Eindhoven
Aantal pagina's27
StatusGepubliceerd - 2014

Publicatie series

NaamECIS working paper series
Volume201403

Vingerafdruk

Broadband
Governance form
Industry
Join
Market economy
Network externalities
Fiber
Market failure
Governance
Telecommunications
Electricity generation
Dynamic markets
The Netherlands
Incentives
Switching costs

Citeer dit

Sadowski, B. M. (2014). Consumer cooperatives as a new governance form : the case of the cooperatives in the broadband industry. (ECIS working paper series; Vol. 201403). Eindhoven: Technische Universiteit Eindhoven.
Sadowski, B.M. / Consumer cooperatives as a new governance form : the case of the cooperatives in the broadband industry. Eindhoven : Technische Universiteit Eindhoven, 2014. 27 blz. (ECIS working paper series).
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Sadowski, BM 2014, Consumer cooperatives as a new governance form : the case of the cooperatives in the broadband industry. ECIS working paper series, vol. 201403, Technische Universiteit Eindhoven, Eindhoven.

Consumer cooperatives as a new governance form : the case of the cooperatives in the broadband industry. / Sadowski, B.M.

Eindhoven : Technische Universiteit Eindhoven, 2014. 27 blz. (ECIS working paper series; Vol. 201403).

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Sadowski BM. Consumer cooperatives as a new governance form : the case of the cooperatives in the broadband industry. Eindhoven: Technische Universiteit Eindhoven, 2014. 27 blz. (ECIS working paper series).