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Theory—Yes, What Sort of Theory?
by William Caspary

It would be hard to take exception to Jaques Kaswan's call for a more explicit and more devel-oped theory of cooperative economics. There is, indeed, a need for more formulation of precise principles—developed from case studies of existing cooperatives and from any applicable ideas that can be gleaned from capitalist economics. Kaswan, goes a step further, however, to propose following mainstream positivist economics in “generating predictions that can be disconfirmed by data.” Such falsifiable predictions would, ideally, permit identifying and learning from our mistakes, and moving toward a reliable set of principles on which to base action. In support of this program, Kaswan claims that “the widespread failure of theoretical predictions (in mainstream economics) has led many mainstream economists to recognize that some of the basic assumptions of capitalist economic theories are seriously flawed.” Perhaps Kaswan can document that assertion, but my own experience suggests a very different conclusion. Findings conflicting with an economist’s prior views are easily dismissed on methodological grounds; ideological positions persist. Conclusions in economics, as in all the social sciences, are under-determined by the available evidence.1

Those economists I’m acquainted with who reject the mainstream point of view, do so on the basis of broad observations of the history and present operation of the economy, and on moral grounds, not on the basis of specific predictive failures. This conclusion about the limits of social science is not a counsel to ignore theory. It is not an excuse for relativism, for an “anything goes” attitude. It suggests a different approach to social science, one that is more experience-near, “clinical,” exploratory, and oriented toward to discovery. Such an approach would not only formulate principles from existing experience of cooperatives, but would deliberately pursue the further development of cooperatives as experiments through which new principles could be discovered. It would accept the fact that much knowledge in the field would be practical knowledge, “knowing how,” rather than “knowing-that.” And though every effort would be made to articulate this practical knowledge and share it in words, it would be accepted that much of it would necessarily remain tacit, not explicit.2 This is the approach of the “clinical” social sciences, and of what has been called “participatory action research,” and it finds its most thorough philosophical formulation in the writings of John Dewey. Dewey states:

the assumption is generally made that we must be able to predict before we can plan and control [i.e., have pure social science first, then application]....The reverse is the case....We should take measures to bring the event to pass....only then can we genuinely forecast the future in the world of social matters.3

Practical knowledge precedes scientific knowledge and is the basis for building the latter. Discovery precedes and makes possible justification. In stressing discovery, Dewey frees us from the tight constraints of formal experimentation on behalf of justification, making bold intervention scientifically legitimate. Justification follows social invention, when promising experimental effects are refined and enhanced until the main causal influences become prominent, and reflectively settled practices ensue. Dewey’s model, unlike the mainstream positivist one, calls for the integration of ethical with empirical inquiry, a posture highly appropriate to the value-driven enterprise of cooperative economics. Social science, if it is to escape triviality, must inquire into what is “deeply and inclusively human,” therefore it “enters perforce into the specific area of morals.”4 Social science must seek “modifications of existence in behalf of [goals] that are reflectively preferred.”5 This does not mean that the preferred goals, the moral choices, escape scrutiny. The outcome of such experiments is a test of the ends as well as the means used to achieve them.

This Deweyan model of theory can be made clearer by considering the Dudley Street Neighborhood Initiative (DSNI), an inspired and successful example of community development in the Roxbury section of Boston. With regard to property, DSNI uses the community land trust model, an alternative to private ownership, and one that discourages real estate speculators. With regard to capitalization DSNI relied on private foundations, and on government programs that were ear-marked not for cooperatives but for housing and community development. Not the most palatable course, but the only one apparently available. Without subsidies, housing simply can’t be built today at prices low income families can afford. DSNI refused to compromise on its core values—on housing design, neighborhood integrity, and service to low income residents—in order to obtain these funds, but it avoided needlessly provoking opposition by political posturing and ideological rigidity. DSNI insisted from the outset on being racially and ethnically inclusive, and far from alienating funding agencies this was counted in its favor. Adapting to the demands of private foundations required rigorous financial planning and accountability—excessively detailed and time consuming, but beneficial in imposing discipline and forcing the development of expertise. Public financing subjected DSNI to the vagaries of changing political winds, but thanks to political savvy and unrelenting effort, approval of their proposals moved through the system despite the coming and going of different administrations. In addition to implications for economic theory, the DSNI case has implications about organizational structure and process—especially its remarkably successful synthesis of high level expertise and grass roots participation. These and other implications of DSNI for cooperative economic theory are, I think, profound, but they do not lend themselves to the precise predictions and formal model building characteristic of mainstream economics. On the contrary, they suggest further practical experiments and initiatives which, while drawing strength from DSNI’s hopeful vision and practice, remain imaginative in adapting them to a wide range of diverse groups and situations. Let us by all means build a more thorough, challenging, empirically based theory of cooperative economics. But rather than repeat the mistakes of mainstream positivist social science, let us pursue a model of inquiry oriented toward intervention, experimentation, and discovery concerning both the facts and values of cooperative economics.


1. James Bohman (1991). New Philosophy of Social Science. Cambridge, MA: The MIT Press.

2. Michael Polanyi (1966). The Tacit Dimension. Garden City, NY: Doubleday.

3. John Dewey (1931). "Social Science and Social Control," Later Works, Vol. 6. Carbondale, IL: Southern Illinois University Press. p. 67.

4. John Dewey (1948). Reconstruction in Philosophy. Rev. ed. Boston: Beacon Press. p. xxvi

5. John Dewey (1929). Experience and Nature (rev. ed.), New York: W.W. Norton & Co. p. 161.

Bill Caspary teaches political theory at Washington University in St. Louis. His book, Dewey on Democracy (Cornell University Press), will appear in Spring, 2000. He has published articles on Dewey’s ethical theory, democratic classrooms, new psychoanalytic explanations of war, the political thought of Carl Rogers, etc. Bill has been a peace movement activist, ombudsman, mediator, and educational change agent. He is active in the Ecological and Transformational Politics section of the American Political Science Association.

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