Cooperative federalism is a school of thought in the field of cooperative economics. Historically, its proponents have included J.T.W. Mitchell, Charles Gide, Paul Lambert, and Beatrice Webb (who coined the term in her book The Co-operative Movement in Great Britain).

Cooperative federalism versus cooperative individualism

Cooperative federalism has been one side in the historical debate in cooperative economics between cooperative federalism and cooperative Individualism. In an Owenite village of co-operation or a commune, the residents would be both the producers and consumers of its products. However, for a cooperative, the producers and consumers of its products become two different groups of people, and thus, there are two different sets of people who could be defined as its 'users'. As a result, we can define two different modes of cooperative organisation: consumers' cooperatives, in which the consumers of a cooperatives goods and services are defined as its users (including food cooperatives, credit unions, etc.), and producer cooperatives, in which the producers of a cooperative's goods and services are defined as its users (which includes worker cooperatives, agricultural producer cooperatives, for example), as advocated by cooperative individualism. In this debate, cooperative federalists are those who support consumers' cooperatives, and those who favor producers cooperatives have been pejoratively labelled ‘individualist' cooperativists by the federalists.

Cooperative federalism

Cooperative federalism is the school of thought favouring consumers' cooperative societies. The cooperative federalists have argued that consumers' cooperatives should form cooperative wholesale societies (by forming cooperatives in which all members are cooperatives, the best historical example being the English CWS) and that these federal cooperatives should undertake purchasing farms or factories. They argued that profits (or surpluses) from these CWSes should be paid as dividends to the member cooperatives, rather than to their workers.

What consumers’ cooperation does

Below is an account of: ‘What Consumers’ Cooperation does,’ excerpted from the May, 1934, issue of Cooperation, which provides an outline of cooperative federalist thought: