Between capitalism and socialism: Tugan-Baranovsky on cooperatives
Mikhail Tugan-Baranovsky (1865–1919) was one of the leading economists of the last quarter of century of Imperial Russia. After 1917, Tugan’s works and ideas circulated mainly outside the Soviet Union. However, his international recognition was due mainly to his contribution to business cycle studies made early in Tugan’s intellectual career. However, studies in cooperation were a significant element of his intellectual output. According to his grandson and biographer (D.M.Tugan-Baranovsky 2010), the focus of Tugan’s activities during his last decade was precisely on cooperation. In 1909, he set up a specialized journal, The Cooperation Herald (Vestnik Kooperatsii), which was published until 1918. Besides, in that decade Tugan published over 30 articles and two books on cooperation in the Russian language, including his 1916 Sotsialnyia Osnovy Kooperatsii (Social Foundations of Cooperation). It was through this lens that Tugan assessed the first years of the Russian Revolution that he was able to witness. We show in our proposed paper that Tugan’s studies about cooperation were not a departure from his initial research agenda. Rather, they followed the same line as his earlier studies in the origins of Russian capitalism and capitalist dynamics. His adherence to the cooperative movement did not lead him to rosy expectation about its role in the social transformation of post-capitalist society. In a country ridden by the fires of revolution, Tugan warned that despite their socialist origins, cooperatives were essentially capitalist enterprises since they assumed self-interest as the basic motivation and private property as a precondition for their existence. Tugan’s approach to cooperatives gained some (albeit restricted) circulation in the West in the context of the search for alternatives both to the practices of Soviet-type economies and to formal modelling of “market socialism”. Tugan referrred in his main book about producer cooperatives to several sources on the topic (including J.S.Mill), but claimed that his was the first general treatise on their theoretical and practical aspects. Mainly due to the language barrier, it was only after E. Domar’s reference to Tugan in his 1966 influential paper, on the analytical aspects of Soviet collective farms, that some Western economists started to pay attention to Tugan’s 1916 book, especially one of its results — that successful cooperatives have an incentive to substitute non-members hired workers for retiring members, leading to a concentration of profits by a reduced member group, until it collapses to a capitalist firm with just one member (the owner). Our paper provides a first historical account of Tugan’s seminal contributions to general theory of producer cooperatives.
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Keywords: Tugan-Baranovsky, cooperatives, socialism, capitalism
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