Cooperatives providing an economic lifeline

Come January, UW–Madison Professor Ann Hoyt will once more head to the nation of Ghana in Sub-Saharan Africa, to continue her work of documenting consumer cooperatives around the globe.

But Hoyt, who holds the only U.S. academic appointment specializing in consumer cooperatives, is also documenting a kind of “reverse technology transfer,” in which lessons in Ghana may prove applicable at home.

“My long-term goal is to see whether these lessons can be applied here in Wisconsin’s low-income communities,” says Hoyt, a professor of consumer science in the School of Human Ecology. “Cooperatives are an effective development tool that use participant input and control.”

Historically in the United States, the strongest cooperatives have been credit unions and agricultural cooperatives. But food coops have experienced increased growth in the past decade, Hoyt says, and there’s a big potential for success for cooperatives addressing health care and elder care needs.

She notes a home health business in Stevens Point, Wis., and Wisconsin RX, the Wisconsin Prescription Drug Purchasing Coalition, as two successful recent cooperative start-ups. Wisconsin RX enables employer groups to gain volume discounts on drug purchases for their employees.

“If we look at Italy and the United Kingdom, it appears that cooperatives are providing higher-quality services at less cost than the government or private sector,” Hoyt says. The same economic potential exists in Wisconsin.

“Cooperatives develop when people realize they have a common need and there’s a strong leader,” Hoyt notes. “A cooperative is fundamentally a self-help strategy. It creates economic benefits and helps create social capital, and it succeeds because of the economic returns and because social networks have value.”

Hoyt, a UW Extension specialist, not only researches the development of cooperatives, she also has personal experience in leading successful cooperatives. For many years she chaired the UW Credit Union board of directors and continues to serve as a board member. She chairs the National Cooperative Business Association and coordinates an annual conference for the Consumer Cooperative Management Association.

Earlier this semester, Hoyt received the 2005 School of Human Ecology’s Excellence in Outreach Award for modeling an outstanding career as an extension outreach specialist. In addition to her work with cooperatives, she was recognized for successfully advocating that universities consider service and outreach in faculty tenure decisions, along with research and teaching.

“I’ve been fortunate to be a faculty member here, where the school’s mission to- improve the quality of human life implies social change,” Hoyt says.