The co-operative building society : Olsonian group theory and economic factor analyses

Abstract

This thesis uses Hong Kong’s empirical data to refute “Olson’s conjecture,” which stated that it is harder for a smaller group than a larger group to disintegrate. It investigates the rise and fall of the civil servants’ co-operative building society, which was a special form of housing arrangement for civil servants in Hong Kong that began in the 1950s. The focus is on the voluntary dissolution of civil servants’ co-operative building societies. Members of a society have a choice to maintain the status quo or opt for dissolution to potentially increase the value of their properties. Olson’s group theory (Olson 1965) and neo-classical economics factors were adopted to evaluate the decision time (i.e., from 1985 until the dissolution date) of the co-operative building society. Group size, land value, the real option value of redevelopment, and the overall housing market sentiment were significant factors that affected the timing of the dissolution of each co-operative building society.