The Two Ginis

Here is a worry any cooperative should take seriously. If members co-own the businesses they help fund, won't the early and the lucky end up owning the most? And won't that ownership, as it compounds, pull the whole community back toward the inequality it was built to escape?

There are two ways to measure inequality here. Normally they rise together:

• Income inequality — how unevenly members' monthly income is spread (their coverage).
• Ownership inequality — how unevenly the businesses themselves are owned.

We measure both with the Gini coefficient. A Gini of 0 is perfect equality; 1 is one person holding everything. The surprising result of the ownership-rotation model is that these two numbers come apart. You can move one across almost its whole range while the other doesn't budge.

Each cycle, a parliament hands its capital to a few members at a time. Who leads that queue is a setting — the allotment order. Point it at need (the furthest-behind member leads) and ownership spreads widely. Point it at seniority (the earliest joiner leads) and ownership concentrates on the founders. In between, it blends.

Below, the model is run across that dial (default settings, seed 12345). For each setting we plot both Ginis — and the graduation date.

The bars — ownership inequality — climb steadily as the dial turns from need toward seniority. But the two lines are almost perfectly flat: income inequality stays near zero, and the graduation date barely moves. The community can spread ownership wide or concentrate it on its founders. Either way, everyone still ends up with essentially equal income, arriving at essentially the same time.

The dial reaches further than the chart shows. There is a dedicated ownership setting that hands the capital to whoever owns the least so far. So every member gets their turn at the bulk investment, with their own agency. It pushes ownership concentration below anything need alone reaches (a Gini near 0.26). Used as a heavy counterweight, it will tame even a founder-first order back toward equality. From about 0.26 to 0.86, the whole ownership axis is yours to set. None of it costs the graduation date or the income equality.

The trick is that income in this model is permanent and capped. Once a share of a business's return stream is assigned to a member, it is theirs for good. Income only ever rises. And no member can climb more than one coverage level per cycle. So when a big owner's businesses would pay them more than the cap allows, the overflow doesn't pile up on them. It spills to whoever is still behind.

Ownership can therefore be as lopsided as you like. But the income it produces is levelled cycle after cycle: the cap skims the top, and the spillover lifts the floor. This repeats until everyone sits within a single level of one another. Concentration of ownership simply does not translate into concentration of income. The two numbers are wired to different circuits.

This decoupling turns a worry into a tool. Concentrating ownership costs nothing — not speed, not income equality. So a community can safely use it as a motivator. Point the dial toward seniority and a community can then say to its early members, concretely: join early, and you own more of what we build together.

And why would anyone join early, and do the hard work of the lean beginning, if the tenth-year newcomer arrived at exactly the same place? The founder-reward answers that: a permanent stake in the businesses they risked the first years to build. And it comes without costing the newcomer anything. Everyone's income still converges. Only the ownership tilts toward those who were there first. It is one of the cleanest incentives a cooperative can offer: a real reward for being early that takes nothing from those who come later.

Most economic decisions are trade-offs: more of this costs some of that. The ownership dial isn't one. Across its whole range the graduation date holds and income stays near-equal. The only thing that changes is who holds the deeds.

So a club gets to choose, deliberately, what kind of economy it wants to be. Ownership spread as evenly as income, or concentrated as a founder's reward, or anywhere between. The model doesn't impose one answer. It hands the community a dial. And it guarantees that, whichever way they turn it, everyone still crosses the finish line together. That is what it means for an economy to be genuinely configurable.