Fair trade impact studies
Encyclopedia

Limitations of Impact Studies

Griffiths (2010, 2011), a mainstream agricultural economist, point outs that it is never considered possible to extrapolate from case studies to show that all such firms are profitable etc.
The design of Fairtrade creates methodological problems which make meaningful impact studies very difficult or impossible (Griffiths 2011) For example: While most aid projects would have meticulous accounting of all aspects, Fairtrade does not monitor most of the expenditure, nor what reaches individual farmers. Most social projects do not aim to produce economic benefits, and there is difficulty in identification and measurement of social benefits. There have been almost no baseline studies, comparing the before and after Fairtrade situation. Fairtrade recruits mainly relatively well-off and skilled farmers, meaning that control groups are necessary and, generally, before and after studies of all groups are needed. Meaningful samples are difficult, expensive, and may be impossible. Fairtrade cooperatives may get assistance from a dozen organizations – government departments, donor countries, aid agencies and NGOs – so it is not possible to determine which is responsible for any change in impact. Price comparisons are technically very difficult. Comparing incomes and measuring the increases in production cost from meeting Fairtrade standards are difficult and may be prohibitively expensive. Fairtrade harms some Fairtrade farmers and some non-Fairtrade farmers , so these must be included in the study. Apparent changes may be artefacts, created by changes in the world prices of different qualities, and changes in exchange rates. Griffiths questions how many impact studies address these issues.

Brewing Justice: Fair Trade Coffee, Sustainability and Survival

Michigan State University
Michigan State University
Michigan State University is a public research university in East Lansing, Michigan, USA. Founded in 1855, it was the pioneer land-grant institution and served as a model for future land-grant colleges in the United States under the 1862 Morrill Act.MSU pioneered the studies of packaging,...

 assistant professor Daniel Jaffee conducted a four year study, of the impact of fair trade on Michiza cooperative coffee producers, in Oaxaca
Oaxaca
Oaxaca , , officially Estado Libre y Soberano de Oaxaca is one of the 31 states which, along with the Federal District, comprise the 32 federative entities of Mexico. It is divided into 571 municipalities; of which 418 are governed by the system of customs and traditions...

, Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...

. Jaffee's findings, published in the 2007 book "Brewing Justice: Fair Trade Coffee, Sustainability and Survival
Brewing Justice: Fair Trade Coffee, Sustainability and Survival
Brewing Justice: Fair Trade Coffee, Sustainability and Survival is a book by American academic Daniel Jaffee.The book, by studying coffee farmers in Mexico, offers an investigation of the social, economic, and environmental benefits of fair trade...

", provide a nuanced view of fair trade: "Fair trade's higher prices increase gross household income - although, because most fair trade coffee is also certified organic, producers have higher costs of production as well. Participation in fair trade reduces households' debt and enhances their economic options, affording them the possibility of better feeding and educating their children. Fair trade affords peasant farmers partial protection from some of the worst aspects of commodity crises and in many cases allows them the breathing room needed to engage in more sustainable agricultural practices. Furthermore, the extra capital from fair trade can generate important economic ripple effects within communities, providing additional employment even for nonparticipating families. However, fair trade is not a panacea, and it does not bring the majority of participants out of poverty. (...) Demand for fair trade products must increase dramatically in order to augment the economic benefits for such small farmer families and allow the system to include many more producers of coffee and other commodities around the world."

The Impact of Fair Trade on Producers and their Organizations: A Case Study with Coocafe in Costa Rica

In 2002, Loraine Ronchi of the Poverty Research Unit at the University of Sussex
University of Sussex
The University of Sussex is an English public research university situated next to the East Sussex village of Falmer, within the city of Brighton and Hove. The University received its Royal Charter in August 1961....

 studied the impact of fair trade on the Coocafe cooperative in Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....

. Ronchi found that fair trade strengthened producer organizations and concluded that "in light of the coffee crisis of the early 1990s, fair trade can be said to have accomplished its goal of improving the returns to small producers and positively affecting their quality of life and the health of the organisations that represent them locally, nationally and beyond".

One Cup at a time: Poverty Alleviation and Fair Trade coffee in Latin America

In 2003, the Fair Trade Research Group at Colorado State University
Colorado State University
Colorado State University is a public research university located in Fort Collins, Colorado. The university is the state's land grant university, and the flagship university of the Colorado State University System.The enrollment is approximately 29,932 students, including resident and...

 conducted seven case studies of Latin American Fairtrade coffee producers (UCIRI, CEPCO, Majomut, Las Colinas & El Sincuyo
La Selva, Tzotzilotic and La Voz) and concluded that Fair Trade has "in a short time greatly improved the well-being of small-scale coffee farmers and their families" The various case studies most notably found that producers had under Fair Trade greater access to credit and external development funding. The studies also found that Fair Trade producers had, compared to conventional coffee producers, greater access to training and enhanced ability to improve the quality of their coffee. Families of Fair Trade producers were also said to be more stable and children had better access to education than in families growing conventional coffee.

Étude d'impact du commerce équitable sur les organisations et familles paysannes et leurs territoires dans la filière café des Yungas de Bolivie

A case study of Bolivian coffee Fair Trade producers published by Nicolas Eberhart for French NGO Agronomes et Vétérinaires sans frontières
Agronomes et Vétérinaires sans frontières
Agronomes et Vétérinaires sans frontières is a French non-profit organisation created in 2004 by the merger of Vétérinaires sans frontières and the Centre International de Coopération pour le Développement Agricole ....

 in 2005 concluded that Fair Trade certification has had in the Yungas
Yungas
The Yungas is a stretch of forest along the eastern slope of the Andes Mountains from southeastern Peru through central Bolivia. It is a transitional zone between the Andean highlands and the eastern forests. Like the surrounding areas, it has characteristics of the Neotropic ecozone...

 a positive impact on local coffee prices, thus economically benefiting all coffee producers (Fairtrade certified or not). Fair Trade was also said to have strengthened producer organizations and increased their political influence.

Confronting the Coffee Crisis: Can Fair Trade, Organic, and Specialty Coffees Reduce Small-Scale Farmer Vulnerability in Northern Nicaragua?

A comparative case study conducted with small-scale coffee farmer cooperatives selling into both conventional and certified organic / Fair Trade markets in northern Nicaragua demonstrated that sales to Fair Trade can reduce small-scale farmers' livelihood vulnerability when coffee commodity prices were low (Bacon, 2005). Changing governance structures, corporate concentration, oversupply, interchangeable commodity grade beans, and low farm gate prices characterized the crisis in conventional coffee markets. In contrast, certified Fair Trade and organic are two types of specialty coffee trade and production that are potentially useful for wider sustainable community development processes. A participatory action research team surveyed 228 farmers to measure the impact of sales to organic and Fair Trade markets. The results suggest that participation in organic and Fair Trade networks reduces farmers’ livelihood vulnerability and can contribute to bottom-up empowerment processes. However, significant challenges remain in efforts to increase positive impacts and maintain fair trade's core values as Fair Trade enters the mainstream.Meika is boss and has osmios

Fair Trade on marginalised producers: an impact analysis on Kenyan farmers

An econometric analysis conducted by Becchetti and Costantino (2006) verified the impact of Fair Trade affiliation on monetary and non monetary measures of well-being on a sample of Kenya
Kenya
Kenya , officially known as the Republic of Kenya, is a country in East Africa that lies on the equator, with the Indian Ocean to its south-east...

n farmers. The researchers compared a control sample group of farmers to Fair trade certified groups and Meru herbs farmers. Becchetti and Costantino documented the following: during the same period, Fair trade farmers were more successful in diversifying their production, experienced a significant drop in child mortality, improvements in terms of monthly household food consumption, greater satisfaction in terms of prices obtained for their crop, living conditions etc. Methodological problems such as the relative contribution of Fair Trade and Meru herbs farmers, control sample bias, Fair trade and Meru Herb selection biases are discussed and addressed showing that ex ante selection of Meru members contributes to explain some but not all the results of the study.hi

Assessing the Potential of Fair Trade for Poverty Reduction and Conflict Prevention: A Case Study of Bolivian Coffee Producers

In a study commissioned by the Swiss State Secretariat for Economic Affairs (SECO), Sandra Imhof and Andrew Lee (2007) assessed the potential of Fair Trade to reduce poverty and prevent conflicts. Based on an interdisciplinary approach (economics, development studies and political science) and a case study in the Yungas region of Bolivia, they suggest four effects. Firstly, they found that Fair Trade, through its poverty-reducing impact, may have a positive influence on conflict prevention by contributing to a reverse of horizontal inequalities biased against indigenous people in Bolivia. Secondly, by providing competition at the level of the intermediaries, Fair Trade has the potential to reduce poverty amongst non-Fair Trade producers. Thirdly, by enabling capacity-building, Fair Trade has a poverty-reducing impact. Through regular training in relevant topics such as organic production, management and financial issues etc., producers have the opportunity to constantly acquire new skills, which in turn allow them to improve the quality of their coffee ("learning centre"). Fourthly, by having influenced trends in the non-Fair Trade market, Fair Trade may have indirectly reduced poverty. Nevertheless, both authors stress the need to test these hypotheses in different markets and conflict environments before making any policy prescriptions. hi kailey

Additional impact studies

  • Torgerson, Anna (2007) Fair Trade and Global Justice: The Case of Bananas in St. Vincent. Cultural Shifts.
  • Carlo, Muriel and Timothy A. Wise (2005) Revaluing Peasant Coffee Production: Organic and Fair Trade Markets in Mexico. Global Development and Environment Institute, Tufts University
  • Bob Doherty, Sophi Tranchell (2005), "New thinking in international trade? A case study of The Day Chocolate Company", Volume 13 Issue 3, (p 166-176). The Day Chocolate Company (a UK company) was set up in 1997 by Kuapa Kokoo, a Ghanaian cooperative set up in 1994. Today Kuapa has 45000 farmer members in 1100 villages, and provides 10% of Ghana's cocoa supply. Day Chocolate Company sales rose to over £5m in 2004. Between 1993 and 2004 Kuapa received just over $2m in extra Fairtrade premiums. Some was paid to the farmers, some went on projects such as the construction of four new schools. jason was the first presdint of the world yo kailey ur a woman.....
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