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Cooperatives vs. Facebook, Amazon & Co - Jonas Pentzien looks into how the platform economy can be democratized

In order to offer an alternative to the platform capitalism of Amazon, Facebook & Co., there are efforts in many countries to build democratic platforms. What are the legal obstacles for democratically controlled online platforms? And by what means can such alternative platforms – among them platform cooperatives – be politically promoted? IÖW scientist Jonas Pentzien spent last year as a Research Fellow at the Institute for the Cooperative Digital Economy of the New School in New York City. Pentzien's conclusion: Although platform cooperativism is a global phenomenon, it is always a result of the socio-political context and national framework conditions in which it emerges. Existing global scenarios must therefore be supplemented by context-specific narratives.

Field research in the USA, Germany and France

With the start of the new Institute for the Cooperative Digital Economy (ICDE) in New York City, founding professor Trebor Scholz appointed political scientist Jonas Pentzien as a Research Fellow for 2019. To find out how platform cooperatives perceive their political environments and related challenges, Pentzien talked to more than 15 founders and members of such cooperatives in the USA, Germany and France. In a second step, he contrasted the results of the qualitative study with a comparative analysis of actual platform-specific government activities in the three countries. In this process, he focused in particular on the policy areas of labor law, cooperative law, competition law, corporate tax law, and financing.

Platform Cooperativism: Understanding Social Context and Political Systems is Crucial

In his study, Pentzien shows the obstacles for democratic platforms in different socio-political contexts and possible ways to overcome them. In addition, his results show the extent to which different political systems offer platform cooperatives different opportunities for development.

For Germany, for example, he was able to demonstrate that the fine print of the many of the country’s public loan programs makes it more difficult to establish platforms under democratic ownership. In France, the current political and legal situation causes platform cooperatives to act primarily as social enterprises that work for the common good, not as companies that compete with the incumbent platform operators. In the USA, the Trump government's budgetary and fiscal policies inhibit democratization processes in the platform economy. Yet, at the same time, cooperative law, which allows for great flexibility in some of the country’s states, also creates innovative possibilities for democratic integration.

According to Pentzien, it is therefore necessary to analyse platform cooperativism not only as a unified global whole, but also as a product of its particular socio-political context. "Only by focusing on the specifics of the different contexts in which platform cooperativism emerges we can understand where governments have the ability to strengthen democratic platform alternatives – and under which circumstances progressive approaches could be translated from one context to another," says Jonas Pentzien. According to him, such context-specific narratives could also help to make political decision-makers aware of the tools they have at their disposal for shaping the often globally oriented platform economy.

Pentzien presented first results at the international Platform Cooperativism Conference "Who Owns the World?“. The study will be published in spring 2020.

Institute for the Cooperative Digital Economy

The Institute for the Cooperative Digital Economy was founded in 2019. Its aim is to create new synergies by integrating research on democratisation processes in the platform economy. Through this, the potential of the global platform cooperativism movement is to be realized and expanded upon.

About the project platforms2share

Jonas Pentzien is currently working on his PhD in the platforms2share project of the IÖW, the Institut für Mittelstandsforschung Mannheim (ifm) at the University of Mannheim and the Fraunhofer IBP in Stuttgart. The junior research group is funded for five years by the Federal Ministry of Education and Research (BMBF) as part of the "Social-Ecological Research (SÖF)" programme in the "Research for Sustainable Development (FONA)" cluster.

Further information: www.platforms2share.org