Written by the Fiveable Content Team • Last updated August 2025
Written by the Fiveable Content Team • Last updated August 2025
Definition
A cooperative is a business organization owned and operated by a group of individuals for their mutual benefit. It operates on principles of democracy, with members having equal voting rights and sharing profits based on their participation.
AP course connection
Topic 4.4: 4.4 Specialized Forms of Business Organization
Member: owner - An individual who owns a share of the cooperative and has equal voting rights in its operation.
Dividend: A member's share of the profits generated by the cooperative, typically distributed based on their level of participation or investment.
Mutual benefit organization: An organization designed to serve the interests of its members, similar in purpose to cooperatives but can vary in structure and governance.