Multifunctionality in Agriculture and Development of Cooperative Credit Banks: A Comparative Analysis in Italy and Ireland

Abstract

Cooperative credit banks in Italy and Credit Unions in Ireland are financial co-ops based on people, with the aim to save and to lend money not for profit. Comparing Italy to Ireland it has been possible to observe a different development of cooperative credit banks, tightly linked to a distinct level of participation of people and public authorities in financial activities.  The main goals of this research have been to analyse, from 2000 to 2010, using a quantitative approach, by a panel data statistical model with balanced random effects (GLS), which socio-economic variables have had an action on the growth of credit co-ops; in particular, the aim of this paper has been to estimate if the multifunctionality in agriculture, in terms of numbers of farms and agro-tourism enterprises, has had some direct effects on the development and growth of credit co-ops in Italy and in Ireland. The main results have underlined a meaningful growth of Credit Unions in many Irish rural counties. In Italy the multifunctionality in agriculture has been able to increase the development of cooperative credit banks in the countryside and to get better living conditions in rural territories, lessening socio-economic and financial exclusion.