In the twenty-sixth IEA Current Controversies Paper, Philip Booth and Linda Whetstone critically examine the arguments of the fair trade movement.
The fair trade movement claims that the products it provides are sourced “justly” and that purchasing fair trade products brings economic benefits for the poor. Whilst it is clear that fair trade might bring some benefits to particular groups, whether it brings significant net benefits to the poor in general is questionable. Moreover, the claim that fair trade transactions are more “just” cannot be substantiated. Customers also might be surprised to learn that the majority of the Fairtrade Foundation’s income is spent on promoting its own brand.
2007, Current Controversies 26
See also: The Poverty of Development Economics by Deepak Lal.