An empirical assessment of Fairtrade: A perspective for low- and middle-income countries? Vienna University of Economics and Business, Department of Economics Working Papers No. 160

This paper presents the first cross-country empirical evidence on the determinants of participation
in Fairtrade and the impact of the export of Fairtrade certified products on
agricultural growth in low- and middle-income countries. Using the number of certified
producer organizations per country in 2006-2010 as a proxy for Fairtrade exports, estimation
results indicate a small but significantly positive effect on the growth rate of per
capita value added in agriculture that is largest in upper middle income countries. Given
the particularly poverty-reducing effect of agricultural growth, we find empirical evidence
that Fairtrade certification is indeed able to deliver its core values, but misses to target
the very poor. (author's abstract)