Professor Dovev Lavie began our conversation by describing his vision of a cooperative economy. He emphasized that the social challenges engendered by our economic systems have taken a toll on us: Think of our general disaffection with the intensity of our worklives; our disappointment with government regulation and legislation; the exploitation that occurs all around us. Dovev emphasized that the solutions we tend to pursue don’t get at the root cause of the problem at its very heart, which he said is the ways in which we pursue our self interests at the expense of others. We as strategy professors have not focused on the distribution of value so much as on its creation and capture. We’ve legitimized taking more than a fair share through our teaching and frameworks. Dovev sees this not as the fault of individuals or even of specific companies, but rather the fault of the design of our economic system.

What is the cooperative-economy solution? Dovev explains that it is not to fix the system we have so much as to create an alternative that can be launched in parallel that will gain support and engagement over time. This alternative system will rely on pro-social behavior, which is the alternative in each of us to opportunistic behavior. We will do this because pro-social behavior makes us happy. What we enjoy – what makes our lives happy – is connection and pro-sociality, not exploitation of others. We each have both tendencies in us, but the current system pushes us toward exploitation. If we run a parallel system that rewards us with happiness for acting pro-socially, we can change the tide of sentiment in our economic lives.

Anita asked Dovev if this is about getting people to be nicer within existing institutions like companies and governments and Universities. His response was to say that he’s asking everyone to be nicer!, but at the same time, the institutional system does have to shift toward, for example, less wasteful consumption. That brought him to a core point in his argument, which is the deployment of a digital system that can set algorithmic rules that align and encourage our natural tendencies toward pro-sociality.

We go back and forth quite a bit on what a digital platform built for this purpose might look like, and how it would work. Dovev explains that the platform could be governmentally sponsored and he indicated that it would be more like Amazon than Google or Meta. He explains that, for example, wealthier people would be charged higher prices for the same thing that poorer people get for free. This would make pro-social wealthier people happier out of an understanding of how the higher price subsidizes others. The goal here, Dovev says, is to redirect responses away from opportunism. Anita had some worries, and ultimately asked for examples of where this might work. Dovev reflected on Kibbutzes and B-Corps and Bhutan and the LDS community as places where community spiritedness is so prevailing that happiness can be enhanced. He responded to Anita’s concerns about the problems of communism by saying that old communistic systems did not have the fairness advantages that can arise through the application of AI, machine learning, and algorithms to enforce equal treatment.

We ended our conversation by reflecting on the success of an experiment that Dovev and his colleagues ran at the Bocconi University cafeteria among students, who happily subsidized the purchases of their less wealthy peers. Dovev added that a key element of a cooperative system like this is that exploitation must be addressed by excluding someone from access. Anita worried that this might be dangerous, but was comforted by Dovev’s explanation that the current system would be running in parallel for those who do not value cooperation in the same way as his pro-social students.

Still lots of questions here!, but the ideas sure are provocative. Anita has posted a link to Dovev’s book and website and other materials. Thank you, Dovev!