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Market access, organic farming and productivity: the determinants of creation of economic value on a sample of Fair Trade affiliated Thai farmers

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  • Leonardo Becchetti

    ()
    (University of Rome Tor Vergata)

  • Pierluigi Conzo

    (University of Rome Tor Vergata)

  • Giuseppina Gianfreda

    (University of Tuscia)

Abstract

We analyse the impact of Fair Trade and organic farming on a sample of Fair Trade organic rice producers in Thailand. We find that per capita income from agriculture is positively and significantly affected by organic certification and FT affiliation years. Such effect does not translate into higher productivity due to a concurring increase in worked hours. FT and organic certification contributions are however downward biased if we do not take into account the relatively higher share of self- consumption of affiliated farmers. Our main findings are robust when we control for selection bias and endogeneity with instrumental variables, propensity score matching and by restricting the sample to affiliated producers only. We also test which of the two (organic and FT) effects is stronger and find that the latter prevails.

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Bibliographic Info

Paper provided by Econometica in its series Econometica Working Papers with number wp05.

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Length: 47
Date of creation: Jan 2009
Date of revision:
Handle: RePEc:ent:wpaper:wp05

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Keywords: organic production; Fair Trade; productivity;

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  1. Kassie, Menale & Zikhali, Precious & Pender, John & Köhlin, Gunnar, 2008. "Organic Farming Technologies and Agricultural Productivity: The case of Semi-Arid Ethiopia," Working Papers in Economics 334, University of Gothenburg, Department of Economics.
  2. LeClair, Mark S., 2002. "Fighting the Tide: Alternative Trade Organizations in the Era of Global Free Trade," World Development, Elsevier, vol. 30(6), pages 949-958, June.
  3. David Reinstein & Joon Song, 2012. "Efficient Consumer Altruism and Fair Trade Products," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 21(1), pages 213-241, 03.
  4. Alfons Oude Lansink & Ky–sti Pietola, 2002. "Effciency and productivity of conventional and organic farms in Finland 1994--1997," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 29(1), pages 51-66, March.
  5. Maseland, Robbert & Vaal, Albert de, 2001. "How fair is fair trade?," Research Report 01C48, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
  6. repec:rtv:ceiswp:262 is not listed on IDEAS
  7. Redfern, Andy & Snedker, Paul, 2002. "Creating market opportunities for small enterprises : experiences of the fair trade movement," ILO Working Papers 357069, International Labour Organization.
  8. Windmeijer, Frank, 2005. "A finite sample correction for the variance of linear efficient two-step GMM estimators," Journal of Econometrics, Elsevier, vol. 126(1), pages 25-51, May.
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Cited by:
  1. Leonardo Becchetti & Giuseppina Gianfreda, 2011. "When Consumption Heals Producers: The Effects of Fair Trade on Marginalized Producers," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 3, September.
  2. Leonardo Becchetti & Stefano Castriota & Nazaria Solferino, 2011. "Development Projects and Life Satisfaction: An Impact Study on Fair Trade Handicraft Producers," Journal of Happiness Studies, Springer, vol. 12(1), pages 115-138, March.

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