Tuesday, December 20, 2005

No Fair

I have to admit that I have gotten caught up in the whole pop economics fad that has been spreading across the media landscape like wildfire. I had never really paid any attention to economics before, but I am fascinated by the explanations of everyday phenomena offered by the great pop economists of our day. I know enough about economics to know that there is plenty of disagreement amongst reputable economists over all but the most trivial economic problems, so I try to absorb all of these pop economic lessons with a side of skepticism.

One consequence of my new found love of economics is that I find myself thinking like a pop economist when I'm out in the world conducting my business. I have been interested in the idea of "fairly traded" food products for a while and have been meaning to figure out what exactly this label means and pass this knowledge on to my loyal readers. As luck would have it, our friends over at Marginal Revolution have beat me to it. I must admit that I don't really follow the entire argument or even the terminology of the discussion (what exactly is a "development optimist"?) That's ok, because I was always more interested in whether or not fairly traded food products actually deliver on their promise to pay the workers in the field a living wage, not the macroeconomic implications of fair trade. The WaPo article linked to in this piece and a link left in the comments section address this issue more directly. The verdict is a hazy, at best. It is unclear whether trade actually helps the people it purports to benefit. It is possible that any positive impact that it has on the life of an impoverished coffee plantation worker might be offset by the bureaucratic overhead imposed by the fair trade apparatus.

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