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In the wake of industrialization, European urban housing policy underwent a market transformation. Housing was no longer a part of shelter provided by a feudal society but an intrinsic part of the industrial entrepreneurial philosophy. To the industrial enthusiast, anxious to exploit new technology for profit, provision for housing for the workers was highly essential.

These industrialists were the proponents of capitalistic individualism, and are cooperating with one another only for private and capitalistic ends. The second half of the 19th century witnessed one of the early developments of a large cooperative home or ‘familistere’ of Guise, France, by the industrialist Godin.

The ‘cooperative’ home here was more paternalistic in nature than socialistic. It could perhaps even be viewed as the ‘invisible hand’ to promote an end which was not part of the actual intention. However, the ‘housing generalization’ in the wake of the industrial revolution did not last long. By the close of the 19th century, the foundations of the contemporary cooperative housing society had been laid.

The cooperative housing movement started in 1869 in Denmark, in the year 1870 in Sweden and in 1889 in Germany as an alternative means of creating provision for housing. The philanthropists such as Owen Salt and Buckingham largely influenced the concept of ‘non-profit making housing’ and the community as a provider of housing. In fact, this led to the strengthening of the British tradition of ‘alms housing’ as well as monastic traditions of Europe. The Builders in Kerala were influenced in earlier times by such a concept.

Most of the housing in Sweden has been built by cooperative or non-profit making corporations governed in part by local authority appointees and in part by independent members. These were therefore instruments of local authority. In Denmark also, the tradition of non-profit making housing authorities (Almennyttige bologselskaber) had been strong. Post War policies in the Federal Republic of Germany (FRG) laid great emphasis on cooperative housing. In the FRG, one finds the epitomization of the Erhard’s social-market economy in the provision of both subsidized as well as unsubsidized accommodation. Trade Union’s involvement in housing in the institution of ‘Neue Heimat’ was a novel step ahead. Since 1972, yet another cooperative response to the needs of the inner cities of Germany under the urban development law (Stradtebauforderungsgestez) made great headway.