domain operations Commons: 4/5

Solidarity Economy

Also known as: Social and Solidarity Economy, SSE

1. Overview

The Solidarity Economy, or Social and Solidarity Economy (SSE), is a transformative economic framework prioritizing people and the planet over profit. It is a global movement of movements, not a rigid model, comprising diverse economic activities rooted in values of cooperation, democracy, social and racial justice, sustainability, and mutualism. The Solidarity Economy aims to solve systemic inequality, exploitation, and environmental degradation by emphasizing collective well-being and democratic governance to create more just and sustainable communities. [1] The concept’s modern origins trace to Latin American social movements in the 1970s and 1980s, which resisted authoritarian regimes and neoliberal policies by creating grassroots, community-led economic alternatives. The term gained international recognition through events like the World Social Forum. While the term is modern, its practices, like cooperatives and mutual aid, have existed for centuries in various cultures, often rooted in Indigenous traditions. The framework connects and strengthens these alternatives, building a force for systemic change. [2]

2. Core Principles

The Solidarity Economy is guided by core principles that distinguish it from mainstream economic models, articulated by networks like RIPESS and REAS, providing a shared ethical foundation.

  1. Primacy of People and Social Object over Capital: Human well-being and social objectives are central, with decisions based on community impact, not just profit.
  2. Democratic and Participatory Governance: Stakeholders (workers, consumers, community members) have a direct voice in governance, fostering empowerment and collective ownership.
  3. Solidarity, Cooperation, and Reciprocity: The framework promotes collaboration and mutual support, replacing market competition with a culture of cooperation.
  4. Equity and Justice: Aims for a more just society with fair wealth distribution, decent work, and actively combating all forms of discrimination.
  5. Environmental Sustainability: Advocates for practices that respect planetary boundaries, promoting sustainable production and consumption.
  6. Territorial Embeddedness: Initiatives are deeply rooted in local contexts, strengthening local economies and community resilience. [3]

3. Key Practices

The Solidarity Economy is embodied in concrete practices that are the building blocks of a more just and sustainable economic system.

  1. Cooperatives: Democratically owned and controlled enterprises where members share benefits and risks (e.g., worker, consumer, producer, housing co-ops).
  2. Community Currencies and Time Banks: Locally-based exchange systems, like time banks where services are exchanged for time credits, building community and providing access to goods and services.
  3. Community Land Trusts (CLTs): Non-profit, community-based organizations that hold land for community benefit, providing permanently affordable housing and other community assets.
  4. Fair Trade Networks: Ensure producers in the Global South receive fair prices and work in decent conditions, challenging exploitative trade dynamics.
  5. Mutual Aid Networks: Informal, grassroots groups where community members voluntarily support each other, building community resilience.
  6. Social Enterprises and Work Integration Social Enterprises (WISEs): Businesses with a primary social or environmental mission, with WISEs focusing on employment for marginalized individuals.
  7. Participatory Budgeting: A democratic process where community members decide how to spend a portion of a public budget.
  8. Commons-Based Peer Production: Collaborative projects creating shared resources, like open-source software or online encyclopedias. [4]

4. Application Context

The Solidarity Economy is a versatile framework applicable across various domains and scales, though its effectiveness is context-dependent.

Best Used For:

  • Community-Led Development: Fostering grassroots, bottom-up development responsive to local needs.
  • Addressing Market and State Failures: Creating community-based solutions for essential goods and services.
  • Building Community Resilience: Enhancing a community’s ability to withstand shocks.
  • Promoting Social Inclusion: Integrating marginalized populations into the economy and society.

Not Suitable For:

  • Rapid, Large-Scale Profit Maximization: The focus on social and environmental objectives is unsuitable for ventures prioritizing high financial returns.
  • Highly Centralized, Top-Down Initiatives: The emphasis on democratic governance is incompatible with hierarchical structures.

Scale: The principles are fractal and can be applied at multiple scales, from individual to ecosystem level.

Domains: Applied in food and agriculture, housing, finance, retail, manufacturing, services, arts and culture, and technology.

5. Implementation

Implementing the Solidarity Economy involves building alternative institutions, fostering a supportive ecosystem, and advocating for policy changes.

Prerequisites:

  • Shared Values and Vision: A group commitment to the framework’s core principles.
  • Community Engagement: Active participation from the community.
  • Access to Knowledge and Skills: Education and training in cooperative management and democratic governance.
  • Supportive Infrastructure: Access to finance, technical assistance, and networks.

Getting Started:

  1. Identify a Shared Need: Identify a community need not met by the market or state.
  2. Form a Core Group: Bring together a passionate group to address the need.
  3. Research and Plan: Research models and develop a plan.
  4. Start Small and Iterate: Begin with a manageable project and scale up.
  5. Connect with the Broader Movement: Connect with other initiatives and networks.

Common Challenges:

  • Access to Capital: Difficulty accessing financing from mainstream institutions.
  • Navigating the Legal and Regulatory Environment: Frameworks are often designed for conventional businesses.
  • Balancing Social and Economic Goals: Maintaining a focus on social objectives while ensuring economic viability.
  • Internal Governance and Conflict Resolution: Democratic decision-making can be complex.

Success Factors:

  • Strong Social Cohesion: High levels of trust and solidarity.
  • Effective and Democratic Governance: Clear and transparent governance structures.
  • A Supportive Ecosystem: Access to finance, technical assistance, and policy support.
  • Adaptability and Innovation: Ability to adapt to changing circumstances.
  • A Long-Term Vision: A shared vision to sustain the initiative. [5]

6. Evidence & Impact

The Solidarity Economy has demonstrated its ability to generate positive social, economic, and environmental impacts.

Notable Adopters:

  • Mondragon Corporation (Spain): A large worker cooperative federation, a powerful example of the Solidarity Economy at scale.
  • Emilia-Romagna (Italy): A region with a dense network of cooperatives contributing significantly to its GDP.
  • Kerala (India): A state with a long history of cooperative initiatives, including the Kudumbashree network of women’s self-help groups.
  • The U.S. Solidarity Economy Network (USSEN): A growing network working to build a solidarity economy movement in the United States.
  • RIPESS (Intercontinental Network for the Promotion of Social Solidarity Economy): A global network connecting solidarity economy movements.

Documented Outcomes:

  • Greater Economic Resilience: Cooperatives show higher survival rates during economic downturns.
  • More Equitable Distribution of Wealth: The model leads to a more equitable distribution of income and wealth.
  • Improved Working Conditions: Worker cooperatives tend to offer better working conditions and more stable employment.
  • Increased Social Cohesion: The framework strengthens social ties and builds community cohesion.

Research Support:

  • The United Nations Research Institute for Social Development (UNRISD) has published extensively on the SSE’s potential to contribute to the Sustainable Development Goals.
  • The International Labour Organization (ILO) has recognized the importance of the SSE in promoting decent work and social justice.

7. Cognitive Era Considerations

The rise of cognitive technologies presents opportunities and challenges for the Solidarity Economy.

Cognitive Augmentation Potential:

  • Enhanced Decision-Making: AI tools can help democratic organizations make more informed choices.
  • Improved Resource Allocation: AI can optimize resource allocation within a community or network.
  • Facilitating Collaboration: Digital platforms can make it easier for people to collaborate.

Human-Machine Balance:

The goal of automation is to augment human capabilities, not replace them. The focus remains on human well-being and empowerment. The uniquely human aspects of the Solidarity Economy—care, empathy, creativity—will become even more important.

Evolution Outlook:

  • Platform Cooperativism: Growth of democratically owned and governed online platforms.
  • Data Commons: New models of data governance that treat data as a shared resource.
  • Decentralized Autonomous Organizations (DAOs): Blockchain-based organizations could provide a new institutional form, but must remain true to the framework’s core principles.

8. Commons Alignment Assessment (v2.0)

This assessment evaluates the pattern based on the Commons OS v2.0 framework, which focuses on the pattern’s ability to enable resilient collective value creation.

1. Stakeholder Architecture: The Solidarity Economy inherently defines a multi-stakeholder architecture that includes workers, consumers, producers, and the broader community. Rights and responsibilities are distributed through democratic and participatory governance structures, where stakeholders have a direct voice in decisions. This approach moves beyond a human-centric view to implicitly include the environment as a key stakeholder, as sustainability is a core principle.

2. Value Creation Capability: This pattern excels at enabling collective value creation that extends far beyond monetary profit. It explicitly prioritizes social and ecological well-being, fostering the creation of knowledge commons, strengthening social cohesion, and building community resilience. By focusing on mutualism and cooperation, it creates a system where value is circulated and shared, rather than extracted.

3. Resilience & Adaptability: The framework is designed to enhance resilience by fostering diverse, locally-rooted economic activities and strengthening community ties through mutual aid. Its emphasis on adaptability and innovation as success factors shows an inherent capacity to respond to change. By decentralizing economic power, it reduces systemic fragility and allows communities to better withstand economic shocks and stresses.

4. Ownership Architecture: The Solidarity Economy redefines ownership as a set of rights and responsibilities shared among stakeholders, rather than just monetary equity. Practices like cooperatives, where members are co-owners, and Community Land Trusts, which separate the ownership of land from the ownership of buildings, exemplify this principle. This architecture ensures that assets are stewarded for the long-term benefit of the community.

5. Design for Autonomy: The pattern’s principles of decentralization and democratic governance make it highly compatible with autonomous systems like DAOs and platform cooperatives. Its emphasis on local, grassroots initiatives promotes a low-coordination-overhead environment at the community level. This design allows for the emergence of complex economic networks without requiring centralized control.

6. Composability & Interoperability: As a meta-pattern, the Solidarity Economy is highly composable and interoperable. It acts as a framework that connects and strengthens various other economic alternatives, from Fair Trade networks to Commons-Based Peer Production. This allows for the creation of larger, integrated value-creation systems by combining different patterns and practices.

7. Fractal Value Creation: The pattern’s core principles are explicitly fractal, meaning the logic of cooperation, democratic governance, and sustainability can be applied at multiple scales. This is demonstrated by its application from small, local mutual aid networks to large-scale federations like the Mondragon Corporation. This scalability allows the value-creation logic to replicate and adapt across different contexts and levels of complexity.

Overall Score: 4 (Value Creation Enabler)

Rationale: The Solidarity Economy is a powerful enabler of resilient collective value creation, deeply aligning with all seven pillars of the v2.0 framework. It provides a robust ethical and practical foundation for building economic systems that prioritize people and the planet. The score of 4 reflects that while it is a powerful enabler, it is a broad framework rather than a single, complete, and universally applicable architecture.

Opportunities for Improvement:

  • Develop clearer models for integrating AI and DAOs in a way that reinforces, rather than undermines, the core principles of solidarity and democratic governance.
  • Create more robust legal and financial instruments tailored to the needs of solidarity-based enterprises to help them scale and interoperate more effectively.
  • Strengthen the framework’s explicit inclusion of non-human stakeholders, such as the environment and future generations, in its governance models.

9. Resources & References

Essential Reading:

  • Utting, P. (Ed.). (2015). Social and Solidarity Economy: Beyond the Fringe. Zed Books.
  • Miller, E. (2010). Solidarity Economy: Key Concepts and Issues.
  • Matthaei, J. (2023). The Solidarity Economy: A Way Forward for Our De-Futured World. Social Encounters, 7(2), 3.

Organizations & Communities:

  • RIPESS (ripess.org)
  • U.S. Solidarity Economy Network (ussen.org)
  • New Economy Coalition (neweconomy.net)
  • Community Economies Institute (communityeconomies.org)

Tools & Platforms:

  • Open Collective
  • Loomio
  • Co-budget

References:

[1] solidarityeconomyprinciples.org. (n.d.). What Do We Mean By Solidarity Economy?

[2] neweconomy.net. (n.d.). The Solidarity Economy.

[3] Wikipedia. (2024). Solidarity economy.

[4] OECD. (n.d.). Case Studies.

[5] UNRISD. (2014). Social and Solidarity Economy: An Opportunity for Sustainable Development.