Question

Give your view on this statement: “The absence of public assistance had forced the people of Europe to establish various types of self-help organization“ (Zeuli & Cropp, 2004, page 6). How can cooperatives play a role in the current economic crisis?

Answer 1

In Europe government does not interfere in market system.government doesn't provide any public assisatance to the individuals.so all things should be brought from market places.in the developing countries government performs a certain actions to maintain the standard of living of every individual and for doing so they give free access to some services.but in europe highly advanced and capitalised countries all the sectors are under private control.and the aim of the private enterprenure is to maximise profit.so they charges higher profit.thats why in europe the cost of living is very high.but all the individuals income is not so good the bear those high costs.and government assistance is unavailable so people have to help himself and neighbours.this is the basic idea of self-help organisation.suppose a individual giving 200$ for the cleaning in front of his house.and there are 10 families.so they all have spend the same amount.but the cleaner can clean the colony at 1000$,now if all the families jointly acquire the fund and clean the colony at once then they have to pay 100$ per head which is half than previous.in this manner self-help organisation can efficiently work.self help organisation can minimal collective costs,can use a things efficiently than by the individual.let us take another example.suppose in the same colony all the family needs to install light in front of their respective houses.then they all have to go electric office individually and launch a application for installation of light pole.for that electric office must take a charge.and this is true for all other families also.but if there was a self help organistion which is organised by the member of that colony,go to electric office and launch a application for installation of light pole at the colony whole then the charge should be lesser than a single individual as electric company can do the same work at once and for a bulk it will be done at lower cost compare to before.becuse before the electric company has to came the same place 10times to do the same work but it can be done at once.and all the family member doesn't have to go electric office.in this way self help group overcome econmic crisis.

Let consider another example.suppose in the colony there are no permanent road.so all the family facing some trouble.but the construction of road need huge expenses.and if the road is constructed all the people of that colony will be benefited from that road.but for a single individual it is impossible to construct the whole road and it is also impossible to construct a road by part as it has to be done as a whole otherwise there will zero benefit.this problem can be solved only by self help organization.if all the members donate a certain amount to the fund for constucting road only then it will be a bigger fund generated by collective effort which can be sufficient to constuct a road.so from this all individual will be benefied.in this way self help organisation can solve economic problems in case of non-existance of public assistance.