The Motivations of Economic Behavior: the Case of Cooperative Credit

This paper investigates the motivation behind economic behaviour in the cooperative credit movement, and some of the inherent problems. In particular, the following hypotheses are analysed: the possibility of maintaining the principles of reciprocity and participation in the case of rapid growth beyond the original group and area; the role and motivations of the social entrepreneurs acting in the bank; corporate social responsibility, which, in the case of a bank, is closely connected to the way in which the community’s savings are employed and investments are selected. The hypotheses are subsequently tested in the historical debate between Schultze Delitzsch’s and Raiffeisen’s approaches. The conclusion is that cooperative behaviour, and in general social responsibility, are more effective and successful when independent from other ends and related to the provision of public goods, which are poorly provided for in the market setting.