The Economic Impact of Cooperation in the Province of Trento

The paper evaluates the economic role of the cooperative system in the province of Trento, Italy. The originality of the paper consists in the approach followed: it takes into account not only the direct value of the production of cooperatives, but also the indirect and induced value generated by the system. The indirect value is calculated as the non-cooperative production used as inputs by the cooperative system; the induced value is calculated as the non-cooperative outcome that is however generated by direct and indirect incomes gathered by the cooperative system. The paper introduces an input-output analysis and reproduces a “satellite” matrix in order to quantify the three types of impact. By using economic data from the Province of Trento from 2005, it comes to individuate a well-developed and consolidated cooperative system, involving 623 firms and 229 thousand members, with a total capital of 2 billion Euros and a production value equal to 3,259 billion Euros. The paper studies these and other values in depth and extracts some specific indexes for the evaluation of indirect and induced impacts. It concludes that, while cooperatives in the Province of Trento represent just 1% of the total number of local firms, they generate 13% of the total value of production and account for 15% of local employment. The presence of a system of organizations that are well-rooted in the local environment significantly contributes to the production of well-being, stability, and growth of the local economy