Cooperative-led growth and Institutional quality:

Abstract

The role of cooperatives in fostering inclusive growth is unevenly distributed across countries and regions. This disparity is gauged by the World Cooperative Monitor (WCM) data which shows the top 300 performing cooperatives. Invoking the endogenous growth theory, this study analysed the effect of cooperatives on economic growth across Global North-South countries. Specifically, the study used largely available data but widely unused panel data from WCM to analyse the trends and patterns of cooperatives' performance from 2016 to 2023. Furthermore, comparative analysis on the role of cooperatives in bolstering inclusive economic growth was empirically analysed using descriptive statistics and a Biascorrected linear dynamic fixed/rand effect model and findings were validated by a dynamic GMM estimator. The study sample was drawn from the 30 countries performing well in cooperatives in the world. Descriptively, the findings reveal that cooperatives in the Global South performed less than those in the Global North due to low institutional quality values. Cooperatives in African countries are marginally represented in the global rank. Further analysis shows that cooperatives have positive and significant effect on economic growth and once are supported with a strong institutional quality framework tend to elevate further economic development. The findings of this study shed light on the existing cooperative growth disparities across countries. In this context, members, cooperative leaders, and cooperative development partners are informed to foster contemporary cooperative transformative motives by emphasising policies related to bolstering institutional quality for inclusive growth to occur. An interesting topic for a follow-up study would be documenting and consolidating cooperatives data for the Global South countries which can further enhance empiric studies across regions.