worker-controlled firm

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A firm which is owned and managed by its workers, or a producers' cooperative. In an industry with low capital intensity, the workers may provide the firm's capital themselves; in more capital-intensive industries, it is possible for them to borrow capital, or to lease buildings and equipment. The advantage claimed for workers' control of firms is that it removes the conflict between owners and workers. It does not, however, eliminate conflicts of interest between the more skilled and senior workers and the less skilled. There are relatively few successful worker-controlled firms. Many worker-controlled firms have failed after being tried as a last resort when other forms of organization had already been tried, and failed.

Subjects: Economics.

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