Does Fair Trade Deliver on Its Core Value Proposition? Effects on Income, Educational Attainment, and Health in Three Countries

Abstract

Alternative trade organizations (ATOs) based on philosophies of social justice and/or environmental well-being are establishing new channels of trade and marketing. Partisans promote ATOs as systems to transfer benefits from consumers in the wealthy northern hemisphere to producers in the poor southern hemisphere. The central public policy question is whether the well-being of poor agricultural producers in the southern hemisphere is actually being improved by fair-trade practices, or are consumers who buy products on this premise deceived? The research reported here partially answers the question whether participation in a fair-trade coffee marketing channel delivers benefits to smallscale producers in Latin America. The authors employ a survey methodology to compare TransFair USA (TF) cooperative participants and nonparticipating farmers in three countries on socioeconomic indicators of well-being. According to the analysis, the economic effects of fair-trade participation are unassailable; the effects on educational and health outcomes are uneven. However, TF cooperative participation positively affects educational attainment and the likelihood that a child is currently studying. The authors find positive health-related consequences of TF cooperative participation.

Marketing as a Means to Transformative Social Conflict Resolution: Lessons from Transitioning War Economies and the Colombian Coffee Marketing System

“…Some have criticized the ideological basis of using consumption to reduce consumption-related problems (Johnston 2002) or to maintain the imbalanced power relations between the Northern Hemisphere (consumers) and Southern Hemisphere (producers) (Lyon 2006). Others have favored fair-trade-expanded economic and social indicators, such as income, education, and health (Arnould, Plastina, and Ball 2009). In this research, we focus on the positive aspects of fair-trade markets as a vehicle for social and economic development.…”

Coffee, cooperatives, and choba-choba: the role of non-market labor networks in building equitable supply chains

“…output prices (Becchetti and Costantino, 2006;Weber, 2011;Méndez et al, 2010) and higher household incomes (Arnould, Plastina and Ball, 2009). Participating farmers have also enjoyed increased purchasing power, improving household food security and nutritional diversity, though also increasing household dependence on purchased food (Jaffee, 2007).…”

Is Fair Trade Really a Solution to Create Fairness in Agricultural Trade? — Case in Indonesia

“…Either way, the main idea of fair trade lies in the theory that by buying such products, the consumer can both satisfy the demand for benefits and, at the same time improve the well-being of poor producers elsewhere in the world [9]. More than just a fair transaction, it develops more like a value in economic activities, for both the consumer and the producer as well.…”