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The Impact of Fair Trade Certification for Coffee Farmers in Peru

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  • Ruben, Ruerd
  • Fort, Ricardo
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    Abstract

    Smallholder farmers producing for Fair Trade market outlets are usually considered to benefit from better prices and stable market outlets. However, many empirical studies verifying this impact suffer from strong selection bias. This study uses a balanced sample of Fair Trade farmers and likewise nonFair Trade producers of organic and conventional coffee from Peru to compare the net effects on production, income and expenditures, wealth and investments, and attitudes and perceptions. After careful matching, we find only modest direct income and production effects, but significant changes in organization, input use, wealth and assets, and risk attitudes. Moreover, important differences between farmers with early and more recent FT affiliation are registered.

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    Bibliographic Info

    Article provided by Elsevier in its journal World Development.

    Volume (Year): 40 (2012)
    Issue (Month): 3 ()
    Pages: 570-582

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    Handle: RePEc:eee:wdevel:v:40:y:2012:i:3:p:570-582

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    Web page: http://www.elsevier.com/locate/worlddev

    Related research

    Keywords: Fair Trade; impact; matching; coffee; Peru;

    References

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    1. Gaëlle Balineau & Ivan Dufeu, 2010. "Are Fair Trade Goods Credence Goods? A New Proposal, with French Illustrations," Journal of Business Ethics, Springer, vol. 92(2), pages 331-345, April.
    2. Marco Caliendo & Sabine Kopeinig, 2008. "Some Practical Guidance For The Implementation Of Propensity Score Matching," Journal of Economic Surveys, Wiley Blackwell, vol. 22(1), pages 31-72, 02.
    3. Giovannucci, Daniele & Ponte, Stefano, 2005. "Standards as a new form of social contract? Sustainability initiatives in the coffee industry," Food Policy, Elsevier, vol. 30(3), pages 284-301, June.
    4. Barham, Bradford L. & Callenes, Mercedez & Gitter, Seth & Lewis, Jessa & Weber, Jeremy, 2011. "Fair Trade/Organic Coffee, Rural Livelihoods, and the "Agrarian Question": Southern Mexican Coffee Families in Transition," World Development, Elsevier, vol. 39(1), pages 134-145, January.
    5. Taylor, Peter Leigh, 2005. "In the Market But Not of It: Fair Trade Coffee and Forest Stewardship Council Certification as Market-Based Social Change," World Development, Elsevier, vol. 33(1), pages 129-147, January.
    6. Jeffrey Neilson & Bill Pritchard, 2007. "Green Coffee? The Contradictions of Global Sustainability Initiatives from an Indian Perspective," Development Policy Review, Overseas Development Institute, vol. 25(3), pages 311-331, 05.
    7. Heckman, James J & Ichimura, Hidehiko & Todd, Petra E, 1997. "Matching as an Econometric Evaluation Estimator: Evidence from Evaluating a Job Training Programme," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 605-54, October.
    8. Martin Richardson & Frank Staehler, 2007. "Fair Trade," ANU Working Papers in Economics and Econometrics 2007-481, Australian National University, College of Business and Economics, School of Economics.
      • Martin Richardson & Frank Staehler, 2007. "Fair Trade," Working Papers 0709, University of Otago, Department of Economics, revised Jul 2007.
    9. Loraine Ronchi, 2002. "The Impact of Fair Trade on Producers and Their Organisations: A Case Study with Coocafé in Costa Rica," PRUS Working Papers 11, Poverty Research Unit at Sussex, University of Sussex.
    10. Aimee Shreck, 2005. "Resistance, redistribution, and power in the Fair Trade banana initiative," Agriculture and Human Values, Springer, vol. 22(1), pages 17-29, 03.
    11. Bacon, Christopher, 2005. "Confronting the Coffee Crisis: Can Fair Trade, Organic, and Specialty Coffees Reduce Small-Scale Farmer Vulnerability in Northern Nicaragua?," World Development, Elsevier, vol. 33(3), pages 497-511, March.
    12. Leonardo Becchetti & Melania Michetti, 2008. "When Consumption Generates Social Capital: Creating Room for Manoeuvre for Pro-Poor Policies," Working Papers 88, ECINEQ, Society for the Study of Economic Inequality.
    13. Valkila, Joni, 2009. "Fair Trade organic coffee production in Nicaragua -- Sustainable development or a poverty trap?," Ecological Economics, Elsevier, vol. 68(12), pages 3018-3025, October.
    14. Laura T. Raynolds & Douglas Murray & Peter Leigh Taylor, 2004. "Fair trade coffee: building producer capacity via global networks," Journal of International Development, John Wiley & Sons, Ltd., vol. 16(8), pages 1109-1121.
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    Citations

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    Cited by:
    1. Balineau, Gaëlle, 2013. "Disentangling the Effects of Fair Trade on the Quality of Malian Cotton," World Development, Elsevier, vol. 44(C), pages 241-255.
    2. Ruerd RUBEN, 2012. "Dimensionner l'aide au développement : ce que nous enseigne l'évaluation. Dimensioning Development Aid: Some Lessons from Evaluation," Revue d’économie du développement, De Boeck Université, vol. 26(4), pages 95-123.
    3. 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.
    4. Takahashi, Ryo & Todo, Yasuyuki, 2013. "Impact of a Shade Coffee Certification Program on Forest Conservation:A Case Study from a Wild Coffee Forest in Ethiopia," Working Papers 55, JICA Research Institute.

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