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Fair Landowner Coffee

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This is a blog on why we believe and do what we do, why we pretend otherwise, how we might do better, and what our descendants might do, if they don't all die.
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Fair Landowner Coffee

Robin Hanson
Jun 25, 2007
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Fair Landowner Coffee

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Many people feel proud of buying "fair trade" coffee, because it is supposed to help the poor people who grow the coffee.   But it turns out that the benefits go to landowners, not laborers: 

In Costa Rica, less than 2% of the coffee produced is certified and sold as Fair Trade. In Guatemala, farmers report the meager benefits promised by Fair Trade, if they materialize, are not worth the costs which must be borne. … Certification, for the producer cooperative, costs between US$2,000 and US$4,000. …  A coffee farm is not eligible for Fair Trade certification if it employs even one person as a permanent full-time employee.  Most family farms, while not enormous, can be tended during the 7-8 months of the growing season quite easily by an average size family. However, during the harvest (November to March) large numbers of seasonal employees are needed . …  immigrants flood into Costa Rica from Nicaragua, Colombia, and to a lesser extent, Panama. These individuals are too poor to own land, but supply the much needed labor for the harvest period. While Fair Trade notes that any seasonal labor should be paid at least the country’s minimum wage, no records are required of the individual landowner-farmers. The wages paid are never verified as part of the certification or annual inspection processes.

Now admittedly these landowners are a lot poor than the average American who drinks Fair Trade coffee.  But it is still curious that coffee landowners elicit more of our sympathy than coffee field workers.   Human altruism is a complex beast. 

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Fair Landowner Coffee

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Overcoming Bias Commenter
May 15

Ecologic Finance (mentioned by Colleen in her post) changed its name to Root Capital.Our website’s URL has changed to http://www.rootcapital.org.

Root Capital is a nonprofit social investment fund that is pioneering finance for grassroots businesses in rural areas of developing countries. Root Capital provides capital, market connections, and financial education to artisan and farmer associations that build sustainable livelihoods and transform rural economies in poor, environmentally vulnerable places.

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Overcoming Bias Commenter
May 15

Hi Colleen,

I am interested in the study that you have done in Central America and which countries you went to to look at the effects of fairtrade on the ground?

Melissa

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