Such models are designed to directly benefit the employees, who own a stake in the company they work for. This directly incentivizes workers to work harder since they will profit from the fruits of their labor while simultaneously benefiting all their neighbors. One significant advantage of running a cooperative is that all the employees actually democratically own the company.
Surprisingly enough, Mondragon Corporation, a cooperative in Spain, survived several bleak recessions and times of unemployment. Several companies that run off this model are able to succeed in great lengths by providing for their owners/employees significantly. For example, cooperative models in the United States have shown to lead to higher wages, guaranteed hours, full benefits
With the proper startup capital, and consultation, cooperatives can be extremely profitable to those who run them. The ground level employee has an equal vote and stake in the company creating an environment where harmony and culture can come together.
One Brazilian recalls, “Brazil was once comprised of hundreds of small farmers struggling to survive, let alone profit from anything. In the past few decades they've organized together and created cooperatives... to become the largest grain companies in Latin America.”
The rural areas of Africa remain underdeveloped and of low-income. Most Africans live in these areas and derive most of their income from the agricultural crops on their land. These agrarian societies have not yet provided enough spirit to produce an overwhelming supporting economy for those living in the rural areas of Africa: These areas cannot produce sufficient food to feed the population.
Cooperatives have been known to be one of the only ways for persons living in impoverished areas to directly help pull themselves out of poverty. Cooperatives work to eliminate some of the famine and poor agriculture production that plagues the county and those within in it. By working to pull resources together, share profits and create large companies, individuals are capable of producing and cooperating at a higher capacity than usual.