Mutualism is a libertarian socialist economic theory and anarchist school of thought that advocates a society with free markets and occupation and use, or usufruct, property norms. One implementation of this scheme involves the establishment of a mutual-credit bank that would lend to producers at a minimal interest rate, just high enough to cover administration. Mutualism is based on a version of the labor theory of value holding that when labor or its product is sold, in exchange it ought to receive goods or services embodying "the amount of labor necessary to produce an article of exactly similar and equal utility".
Mutualism originated from the writings of philosopher Pierre-Joseph Proudhon. Mutualists disagree with the idea of individuals receiving an income through loans, investments and rent as they believe these individuals are not laboring. Although Proudhon opposed this type of income, he expressed that he had never intended "to forbid or suppress, by sovereign decree, ground rent and interest on capital. I think that all these manifestations of human activity should remain free and voluntary for all: I ask for them no modifications, restrictions or suppressions, other than those which result naturally and of necessity from the universalization of the principle of reciprocity which I propose". Insofar as they ensure the worker's right to the full product of their labor, mutualists support markets and property in the product of labor. However, they argue for conditional titles to land, whose ownership is legitimate only so long as it remains in use or occupation (which Proudhon called "possession"), advocating personal property instead of private property.
As libertarian socialists, they have distinguished mutualism from state socialism and do not advocate state control over the means of production. Instead, each person might possess a means of production, either individually or collectively, with trade representing equivalent amounts of labor in the free market. Benjamin Tucker said of Proudhon that "though opposed to socializing the ownership of capital, he aimed nevertheless to socialize its effects by making its use beneficial to all instead of a means of impoverishing the many to enrich the few [...] by subjecting capital to the natural law of competition, thus bringing the price of its own use down to cost".