Impacts of Fairtrade on Small-Scale Cotton Producers - A field study in rural India.

Abstract

ABSTRACT The number of Fairtrade labeled products in the stores continues to increase and more and more consumers choose Fairtrade as an alternative to conventional products. Fairtrade seeks to improve the livelihoods of small-scale producers and reduce poverty by implementing several standards for economic, social and environmental development. The aim of this thesis is to investigate the economic impacts of Fairtrade as well as the effects of Fairtrade on farmers’ standard of living. 101 farmers from the producer organization Chetna Organic in India were interviewed using a questionnaire. The impacts of Fairtrade are estimated through regression analysis, where positive statistically significant effects of Fairtrade on land productivity, credit use and perceived influence in cooperative are shown, while Fairtrade negatively affects food shortage. The farmers claimed to be satisfied with Fairtrade in spite of their limited knowledge of it, which makes it difficult to determine if Fairtrade is the actual cause of their satisfaction.