The earliest state cooperative laws in the United States were stock laws modeled
upon the Rochdale experience and were adaptations of basic corporate laws of
incorporation to the cooperative form of organization. They emphasized stock as
the basis of membership and the distribution of profits to members in proportion
to patronage. After 1911, the dominant form of cooperative law became the nonstock
law. which emphasized service at cost and the personal. fraternal nature of
membership in a cooperative. Since 1925. both forms of cooperative law have
coexisted. The different emphasis placed on capital stock. profit. and membership
in a cooperative by the two different legal structures may be one contributing factor
to current dilemmas cooperative leaders face in generating and rewarding equity
capital.
