Does Fair Trade Deliver on Its Core Value Proposition? Effects on Income, Educational Attainment, and Health in Three Countries
Published 11/1/2009
Author: Eric J. Arnould, Alejandro Plastina and Dwayne Ball
View this contentExecutive Summary
Alternative trade organizations (ATOs) based on philosophies of social justice and/or environmental well-being are carving out spaces alongside traditional agricultural exports by establishing new channels of trade. Partisans promote these “fair trade” systems as vehicles to transfer benefits from consumers in the wealthy northern hemisphere to commodity producers in the poor southern hemisphere. The central public policy question is whether the well-being of poor agricultural commodity 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 provides a partial answer to the question whether producer participants in a prominent U.S. ATO, TransFair USA—a fair trade coffee marketing channel—enjoy income, education, and health benefits. To address this research question, the authors collected quantitative measures in three countries with substantial TransFair USA fair trade coffee marketing. They employed a survey methodology to compare TransFair USA cooperative participants and nonparticipating farmers, all of whom were small-scale coffee producers, on several socioeconomic indicators of well-being. According to the analysis, the positive economic effects of fair trade participation are unassailable; the effects on educational and health outcomes are uneven. However, TransFair USA’s cooperative participation positively affects educational attainment and the likelihood that a child is currently studying. The authors also find positive health-related consequences of TransFair USA cooperative participation.
Biography
Eric Arnould joined the University of Wyoming faculty in fall 2007 to foster new initiatives in sustainable business practice. He has pursued a career in applied social science since receiving his BA in 1973. While enjoying the challenges of working as a consultant in agricultural, marketing systems, and natural resource management in more than a dozen West African countries between 1975 and 1990, he earned a PhD in Economic Anthropology with a minor in Archaeology (1982) and pursued a postdoctoral fellowship in the marketing department (1982–1983), all at the University of Arizona. Dr. Arnould’s research on development, services marketing, consumer culture theory, and marketing channels in developing countries has appeared in more than 90 articles and chapters in major social science and managerial periodicals and books. He serves on the review boards of several journals and is an associate editor of Journal of Consumer Research.
Alejandro Plastina is an economist at the Secretariat of the International Cotton Advisory Committee in Washington, D.C. Dr. Plastina received his MS in Statistics in 2005 and his PhD in Agricultural Economics in 2007 from the University of Nebraska–Lincoln. He received his BA in Economics in 2000 and his MS in Health Economics and Management (ABT) in 2002 from the Universidad Nacional de La Plata, Argentina. Dr. Plastina’s research interests include public policy analysis and econometrics.
Dwayne Ball is Associate Professor of Marketing at the University of Nebraska–Lincoln. He obtained his doctorate in Mathematical Psychology at the Ohio State University in 1982 and subsequently worked for four years as a consumer research manager for Procter & Gamble. He has been a visiting lecturer at the University of Canterbury in New Zealand and a Fulbright Scholar and visiting professor at the Higher Institute for Statistics and Information Management of the New University of Lisbon, Portugal. Dr. Ball’s interests are in market research topics, such as the explanation of customer loyalty, validation of multivariate statistical methods, measurement of complex consumer behavior constructs, and academic freedom. He has published in Journal of Marketing Research, Journal of Consumer Psychology, and European Journal of Marketing, among many other outlets.
Journal of Public Policy & Marketing, Volume 28, Number 2, Fall 2009
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