PROFIT-SHARING AND COOPERATION 80I
sharing introduced in 1842 continued in force for the period of a generation, and in 1869, a few months previous to the founder's death, was transformed into a true cooperative association, now known as Redouly ct C". The experience of this firm is so well known that it hardly needs repetition here.
Less well known, but of scarcely less importance, is the firm of Larouche-Joubert et C", now the cooperative paper works of Angouleme, France. The difficulties in the way of both profit- sharing and cooperation in this industry are very great, for the fixed capital is proportionately very large, and the cost of labor is but a small portion of the total cost of production. But the success is no less marked. Beginning a rudimentary participa- tion the year after Leclaire instituted his profit-sharing scheme, various modifications of the wage system, such as progressive wages, bonus on production, and prizes based on quality, guaran- teed high rate of interest on deposits made by laborers toward the purchase of stock, and stock-holding by employes were successively introduced. It is this latter that has become of greatest importance. This firm has adhered to the plan of paying in cash all dividends from profits, and hence some phases of the transition do not appear to as great advantage as in other systems. The employes purchase stock as they are able, exceptional advantages to this end being afforded. The dividends made would, in time, make the purchase, but there is no compulsion. Deposits of from 20 to 5,000 francs were received, drawing 12 per cent, interest, the one provision being that the depositor had worked for the firm for two years. When the deposit amounted to 100 francs, it received a specified share in the profits. The larger deposits are exchanged for shares of stock, so that in time the workmen shall become the owners of the entire establishment. The profit-sharing system was quite complex, being specifically adapted to the several different departments of the business. After paying all fixed charges and expenses, including 5 per cent, interest on stock and salaries of managers, 30 per cent, of the net profit is divided among the six directors, 10 per cent, to the superior employes, 12 per cent, among the customers of the house, much
