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Market Imperfections and Fair Trade


  • Alessandro Arrighetti


The aim of the paper is to show that fair trade strategies play a major role in remedying market shortcomings at the level of organizational and information variables. The empirical evidence confirms the hypothesis that the greatest benefits for local producers stem from changes in advantageousness from short- to long-term objectives, increased investment propensity, and enhancement of collective action in the production of both private and collective goods, rather than from temporary increases in income.

Suggested Citation

  • Alessandro Arrighetti, 2009. "Market Imperfections and Fair Trade," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 1, March.
  • Handle: RePEc:rar:journl:0096

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    References listed on IDEAS

    1. Gould, David M. & Gruben, William C., 1996. "The role of intellectual property rights in economic growth," Journal of Development Economics, Elsevier, vol. 48(2), pages 323-350, March.
    2. A. Arrighetti, 2007. "Fair trade, premio di prezzo e fallimenti del mercato," Economics Department Working Papers 2007-EP06, Department of Economics, Parma University (Italy).
    3. A. Affuso & A. Arrighetti & G. Seravalli, 2003. "L'avvio dello sviluppo locale nei paesi a elevata poverta':il problema delle trappole combinate," Economics Department Working Papers 2003-EP01, Department of Economics, Parma University (Italy).
    4. Fabrizio Adriani & Leonardo Becchetti, 2004. "Fair Trade: A 'Third Generation' Welfare Mechanism to Make Globalisation Sustainable," CEIS Research Paper 62, Tor Vergata University, CEIS.
    5. 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.
    6. Stephanie Barrientos, 2000. "Globalization and ethical trade: assessing the implications for development," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(4), pages 559-570.
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    More about this item


    Trade; Fair Trade; Microeconomic Analysis of Economic Development; International Trade; Social Labels;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • D6 - Microeconomics - - Welfare Economics
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce


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