Consumer Demand for Fair Trade: Evidence from a Multistore Field Experiment

Hainmueller, Jens; Hiscox, Michael; Sequeira, Sandra

doi:10.1162/rest_a_00467

Cited by 205 publications

(115 citation statements)

References 51 publications

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“…3 As shown in one of the recent field experiments, consumers are indeed willing to pay more for a fair trade products. For example, it finds that the sales of the coffees rose by almost 10% when they carried a fair trade label as compared to a generic label (Hainmueller et al 2015). 4 In order to procure fair trade certified raw materials, firms must make a quantity commitment in advance by (often in long-term) contract.…”

Section: Resultsmentioning

confidence: 99%

“…Howard and Jaffee (2013) consider the relationship between firm size and sustainability. Using field experiments, Didier and Lucie (2008) investigate willingness to pay for fair trade and organic products, and Hainmueller et al (2015) show that the fair trade label is effective in promoting product sales. As pointed out by Moore (2004), although the empirical studies are well-established and useful to understand issues in the fair trade movement, they should be accompanied by theoretical investigations.…”

Section: Literature Reviewmentioning

confidence: 99%

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Money Well Spent? Operations, Mainstreaming, and Fairness of Fair Trade

Lim

Mak

Park

2019

Production and Operations Management

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We examine the operations, fairness, and social implications of fair trade certified products. We consider the market for fair trade certified products, which may serve as a substitute to a regular product. A fair trade organization chooses standards for the certification, namely, the (unit) premium and minimum fraction of fair trade raw materials, to maximize the total premium transferred to farmers. We analyze the operations of various stakeholders in the fair trade value chain, as well as the role and social welfare of fair trade organizations with different philosophies. We characterize the firms’ entry decision in the fair trade market as well as the resulting market equilibrium. Furthermore, we examine the impact of mainstreaming, i.e., whether to allow large‐scale plantations (often owned by large corporates) to be eligible for fair trade certification or not, which is one of the most discussed topics in the fair trade movement. We also identify the welfare allocation among various stakeholders in the value chain under different certification policies, and thereby address the fairness issue of the fair trade market as well as its resulting social welfare implications. Finally, we obtain a number of policy insights and suggestions to support this nascent marketplace.

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Section: Resultsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Money Well Spent? Operations, Mainstreaming, and Fairness of Fair Trade

Lim

Mak

Park

2019

Production and Operations Management

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“…In Sweden, for example, approximately 60% of respondents report doing so, while by contrast in the US, some 28% report doing so (Stolle & Micheletti, 2013, p. 97). The dramatic rise in popularity of so called Fair Trade branded goods is one manifestation of this (Fairtrade International, 2016;Nicholls, 2010), and experimental research has suggested that in certain conditions, particularly for higher cost items, consumers are willing to pay more for clothing and grocery store items that are labeled as being made in better conditions Hainmueller, Hiscox, & Sequeira, 2015). Consumer demand for socially compliant goods is also reflected in the degree to which lead firms have implemented codes of conduct in their supply chains and have joined various multi-stakeholder initiatives (Locke, 2013).…”

Section: Consumer Citizenshipmentioning

confidence: 99%

A Supply Chain Approach to Trade and Labor Provisions

Kolben

2017

PaG

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As labor provisions in trade agreements have become increasingly ubiquitous, there remain questions about whether or not these provisions have been effective in improving working conditions in trading partner countries. Through an analysis of sample labor provisions in United States and European Union free trade agreements, this paper shows that both approaches, albeit using different methods, aim primarily to improve de jure labor law and de facto enforcement of that law by government regulatory institutions. This paper argues that instead, labor provisions ought to be grounded in a supply chain approach. A supply chain approach shifts the focus from impacting de jure and de facto labor law as administered by the state though sanctions or dialogue, and towards context specific, experimental, and coordinated private and public regulatory interventions that operate in key export industries that are implicated in trading partners' supply chains. It does so in part by recognizing the potential regulatory power of consumer citizenship.

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“…The authors postulate that this positive effect is due to consumers' perception of shared social responsibility under pay-what-you-want pricing; i.e., this pricing regime allows them to explicitly express their social consciousness through purchasing of the product, thereby increasing their willingness to contribute. Other field experiments in the sustainability domain include Prasad et al (2004), Hiscox (2012), andHainmueller et al (2015).…”

Section: Marketing and Economic Studies On Consumers' Valuations Of Smentioning

confidence: 99%

Environmentally Responsible Supply Chains

Atasu¹

2016

Springer Series in Supply Chain Management

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Consumer Demand for Fair Trade: Evidence from a Multistore Field Experiment

Cited by 205 publications

References 51 publications

Money Well Spent? Operations, Mainstreaming, and Fairness of Fair Trade

Money Well Spent? Operations, Mainstreaming, and Fairness of Fair Trade

A Supply Chain Approach to Trade and Labor Provisions

Environmentally Responsible Supply Chains

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