Profits and poverty: Certification's troubled link for Nicaragua's organic and fairtrade coffee producers
AbstractGovernments, donors and NGOs have promoted environmental and social certification schemes for coffee producers as certified market channels are assumed to offer higher prices and better incomes. Additionally, it is presumed that these certifications contribute to poverty reduction of smallholders. Yet, gross margins, profits and poverty levels of certified smallholder coffee producers have not yet been quantitatively analyzed applying random sampling techniques. Our quantitative household survey of 327 randomly selected members of conventional, organic and organic-fairtrade certified cooperatives in Nicaragua is complemented by over a hundred qualitative in-depth interviews. The results show that although farm-gate prices of certified coffees are higher than of conventional coffees, the profitability of certified coffee production and its subsequent effect on poverty levels is not clear-cut. Per capita net coffee incomes are insufficient to cover basic needs of all coffee producing households. Certified producers are more often found below the absolute poverty line than conventional producers. Over a period of ten years, our analysis shows that organic and organic-fairtrade farmers have become poorer relative to conventional producers. We conclude that coffee yield levels, profitability and efficiency need to be increased, because prices for certified coffee cannot compensate for low productivity, land or labor constraints.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Ecological Economics.
Volume (Year): 70 (2011)
Issue (Month): 7 (May)
Contact details of provider:
Web page: http://www.elsevier.com/locate/ecolecon
Fairtrade certification Gross margin Income Organic certification Profitability Poverty;
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Linda Kleemann & Awudu Abdulai, 2012. "Organic Certification, Agro-Ecological Practices and Return on Investment: Farm Level Evidence from Ghana," Kiel Working Papers 1816, Kiel Institute for the World Economy.
- Wilson, Adam P. & Wilson, Norbert L., 2013. "The Economics of Quality in the Specialty Coffee Industry: Insights from the Cup of Excellence Auction Programs," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150721, Agricultural and Applied Economics Association.
- Barham, Bradford L. & Weber, Jeremy G., 2012. "The Economic Sustainability of Certified Coffee: Recent Evidence from Mexico and Peru," World Development, Elsevier, vol. 40(6), pages 1269-1279.
- Balineau, Gaëlle, 2013. "Disentangling the Effects of Fair Trade on the Quality of Malian Cotton," World Development, Elsevier, vol. 44(C), pages 241-255.
- Linda Kleemann & Awudu Abdulai & Mareike Buss, 2013. "Is Organic Farming Worth its Investment? The Adoption and Impact of Certified Pineapple Farming in Ghana," Kiel Working Papers 1856, Kiel Institute for the World Economy.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.