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    You said they would starve but can they not eat the honey
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    fish paste you make me laugh so hard when you talk about market equlibrium, its absolute bull , you might as well believe in a perfect supply and demand curve :P *******s economic theory always ignores general processes which take time to occur, a economic is dynamic and unstable and certainly not in fantasy equilibrium. Such Walrasian belief in the free market (which incedently it never is or can be) is ridiculous. By all means attack fair trade (which your wrong about) but don't use crappy economic arguements that are found in AS economic text books
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    Fair Trade is a good thing, it means that the workers get a fairer amount of money for their produce... right?

    If you take a cynical approach though, the workers are getting a fairer pay, the companies will still be making a profit but the consumer loses out with a slightly higher price to buy the goods. The fact that it's slightly more expensive may put people off buying ft and also Fair Trade isn't widely available...

    I'd say about 8/10 people don't even know what Fair trade is
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    i'm not going to quote all of undiscovered self's post, but
    YES I agree!
    And paying them a good price is not an paying them an artifically high price because the prices we pay in developing companies are artifcially LOW. people in developing countries have to accept that if they don't want to keep exploiting people in the developing world, prices have to rise slightly.
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    (Original post by fishpaste)
    Does it? How do you know it isn't going to undermine the free market? I don't know the complex economic arguments, but I know enough to know that ultimately any bent from the free market equillibrium is going to result in less than maximum benefit.
    On the contrary, the resrtiction of free trade is what will cause less than maximum benefit.

    Picture this: Brazilian farmer producing more efficiently than French farmer - better climate, more land etc.. French government wants French farmer to keep his job, so restricts Brazilian imports and indirectly subsidises French farmer's outputs through making French consumers buy expensively produced French products. French comsumers pay higher prices for French goods (like a tax that they don't realise, keeping the farmers on the government's side), Brazilian farmers get low prices for their (better quality) goods, and the market fails.
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    (Original post by thor)
    fish paste you make me laugh so hard when you talk about market equlibrium, its absolute bull , you might as well believe in a perfect supply and demand curve :P *******s economic theory always ignores general processes which take time to occur, a economic is dynamic and unstable and certainly not in fantasy equilibrium. Such Walrasian belief in the free market (which incedently it never is or can be) is ridiculous. By all means attack fair trade (which your wrong about) but don't use crappy economic arguements that are found in AS economic text books
    I absolutely do not deny that my argument uses nothing more than simple AS economics and some basic game theory. But if you're going to argue it's flawed, you'll have to do more than state it's based on AS economics theory. WHY is it flawed? What factor have I omitted?

    I recognise that agricultural markets are dynamic and changing, and I think this is covered when I said it is a game which has one 'best possible' outcome, and this is the outcome we arrive at through the free markets.
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    (Original post by mik1a)
    On the contrary, the resrtiction of free trade is what will cause less than maximum benefit.

    Picture this: Brazilian farmer producing more efficiently than French farmer - better climate, more land etc.. French government wants French farmer to keep his job, so restricts Brazilian imports and indirectly subsidises French farmer's outputs through making French consumers buy expensively produced French products. French comsumers pay higher prices for French goods (like a tax that they don't realise, keeping the farmers on the government's side), Brazilian farmers get low prices for their (better quality) goods, and the market fails.
    I am arguing FOR the free market, not for multiple layers of protectionism as you're describing here.
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    "There is no long-term future for the Guatemala model, it's just not economically efficient," says Alex Singleton, a fellow at the free trade think tank, the Adam Smith Institute.

    "The problem that Fairtrade faces is that it just doesn't address market realities, that coffee is going to get a lot cheaper."

    "We need to work out ways to help [the poor], ways that actually help them rather than to simply make us feel better.

    And the best way to do this, he feels, would be to "open up our markets to them".


    The argument is simple.
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    (Original post by jojo)
    heya!
    i need like the exact definitions of fair trade and non- fair trade, but whenever i type it on the google it comes up with these sites about it and they don't say what it is exactly. can anyone pleaseeee help me??
    i am not 100% sure what they are, so i don't know how to word it... :confused:
    ahhh help!!
    thank you
    jo
    Try looking for the word 'coersion' (sp) in a google search alongside trade
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    (Original post by UndiscoverdSelf)
    i was so annoyed by some of the astonishingly irresponsible earlier comments on this thread that i have here written a more comprehensive defence of fair-trade. in order to illustrate the case for fair-trade i have used the example of tropical forest products, a company directed by my parents.

    i am using the example of my parents' company because it has many characteristics typical of fair-trade companies:
    1) it supports the long-term development of traditional communities. this is sustainable development.
    2) it is not run for the purpose of generating wealth for the company directors. that is, it develops rather than exploits.
    3) it involves local people at every level
    4) it was initially supported by the government but is now independent

    A TYPICAL STORY OF A FAIR-TRADE COMPANY:
    the honey company started off like many other fair trade companies, which are today increasingly entering the public arena, during the late 70s and early 80s. funded initially by the german government, my parents went to zambia in order to set up a company that could buy honey from the locals and sell it in britain and other more developed countries. the locals were at this time in this area of zambia (kabompo) extremely poor due to a variety of factors. they were, and are still today, subsistence farmers. diseases such as malaria and HIV are rife.

    although bee-keeping was part of the traditional culture it was not exercised on a commercial scale. therefore our company was set up to teach the local people how to produce sufficient quantities to make it commercially viable. the locals were taught not only by my parents and the other government workers, but locals were involved at all stages. today the company is run by a zambian.

    in the long-term, the company has helped keep the people of kabompo out of the poverty trap. today their honey is sold in most large european supermarkets and is for example used in the bodyshop cosmetics range. they have a guaranteed overseas market. if their product was not a fair-trade product, their overseas market would not be as secure. similar projects are being developed throughout zambia have also been successful in other developing countries such as mozambique and vietnam.

    when we buy the honey from the producers we obviously do not buy it at a higher price, as an earlier contributor to this thread falsely claimed was the practise of fair-trade companies, because our company has to be able to sell it in tesco and waitrose at a competetive price. we are a commercial enterprise. our fair-trade zambian honey is not any more expensive on the supermarket shelf than a non fair-trade honey from other developing countries such as brazil.

    the benefits that the honey company has brought to the kabompo region of zambia are numerous. including:
    a) the local people have a sustainable means of supporting themselves. they do not have to rely on western charitable organisations in order to secure their livelihoods. the company is now a commercial non-state-funded organisation.
    b) no damage has been done to the local environment. beekeeping protects indigenous flora and wildlife habitats.
    c) beekeeping is by no means a full-time occupation, and it is frequently carried out by women. this means they are able to produce an income on the side. in a country where medical care is expensive and diseases are common this is of the utmost importance. furthermore, having that little bit extra cash, that is, not living on or below the poverty line, can enable young people to make more ambitious life decisions.
    d) the future of the community is secured to a greater degree. traditional community values and the zambian way of life have not been lost. fair-trade companies such as our honey companies are built around local communities.

    it is also valid to argue that fair-trade companies have brought benefits to countries such as zambia because of the alternative they have avoided. this alternative consists of:
    a) profit-orientated companies such as nestle or monsanto moving into the community. these companies do not consider themselves to be responsible to the community. their aim is to make as much money as possible. therefore projects are large-scale, short-term and money-grabbing.
    b) such projects cause severe environmental damage. for example, agricultural areas will be destroyed to make room for a single cash crop such as coffee or maize. this will destroy the natural balance of the ecosystem for many generations to come. this means that not only will the local people no longer be able to grow their own food to feed their families, but other cash crops will not be able to be produced.
    c) the local people are paid a very minimal wage and are completely reliant on the corporation for their livelihoods. this means that when the corporation decides to abandon the area because they can make more money elsewhere, the local people are left without any means of support. that is, they starve.

    by buying fair-trade products, you will therefore be making a real difference to the lives of people in developing countries: you will be supporting the sustainable development of communities. you can recognise fair trade products because they carry the fair trade symbol, similar to the soil association organic symbol (this is certainly the case in the uk; perhaps different symbols apply in other countries). in order to carry the fair-trade symbol, companies have to commit themselves to serving the producers' communities in the long-run. this means you can be sure that when you buy a fair-trade product you are making a responsible and ethical choice.
    As noble as this all sounds, I am not remotely convinced that you are looking beyond the immediate and direct implications of fair trade. At least economists such as the fair trade think tank are considering the wider, more ultimate effects of it.
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    Fair trade chocolate doesn't taste very good
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    Actually i rather like the "divine" white chocolate

    Ok fishpaste il explain myself for ya, and sorry about ripping into you in such an arrogant way

    "Even in a static model, increasing the prices to farmers for their crop is increasing supply, increased supply creates lower prices in the long run. And that doesn't include the hog cycles, you knock suppliers off the equillibrium output and you can create diverging hog cycles, prices will become more and more unstable over time until farmers permanently leave the market.

    Economics is a game, and will operate under the rules of some defined game theory. You can't just look at the short term and say "more prices, great!" You have to look at the long run, and the final outcome of the game. In this case, the final outcome will be losing for the farmers."



    First off a static model as I pointed out earlier is a not what you should look at to base anything on economically, if its not being measured with time its going to be completley wrong. Secondly your point about the farmers is really based around supply and demand in neoclassical theory terms. (Ie the Scissor shaped supply and demand curve). i shall concentrate on the demand theory flaws here.

    The problem with this is that market demand and supply curves do not function in this format. Regarding demand curves, they are based upon static and flawed social indifference curves. These curves form part of the basis of the market demand curve and only in theoretical restricted conditions do they even replicate the theory. Instead the curves change with time and even intersect the supply curve were you to draw it out. Only through belief of social indifference curves can a completle free market be assumed to be the best.

    Furthermore Bentham, must have heard of him, his ideas of utility and his position that a society can be reduced to its individuals is where more flaws have developed. In neoclassical economics (the current standard) the theory represents the whole of society as if it were one individual due to benthams assumptions. These are incorrect as a society is more than just a sum of its individuals, its something quite apart. Both the flaws in benthamite theory and social indiffernece and engles curves result in the scissor supply & demand curve and thus result in innaccurate theory such as pure free trade being the most benefical.

    I can also draw a historical point from this in that the success of every developed nation has been based upon unfree trade through original protectionism against comptitiors, this still continues today. We however tell developing nations the exact opposite of what led us to our economic success, that they must open their markets for example, and thus we lock them in poverty through our own agenda.

    Free trade is often the champion of the wealthiest despite the rest of world

    ie. America today, and by its power the WTO and the IMF and the World Bank.
    100 years ago it was the British Empire


    Im not the best at explaining these flaws but I can tell you where to find a more in depth view , from economists Artyma Sen, Steve Keen and Ha joon Chang.

    Incidentally i agree that We should drop our trade barriers as Oxfam suggests to help the poor farmers, this IS fair trade and is more benefical than mere fair trade goods.
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    (Original post by fishpaste)
    What do people think about fair trade? Help or hinder?
    i think its a pretty cool idea in theory, but its a real pain at college sometimes. we could ahve got a brand new student common room but because it was sponsored by nestle we missed out
 
 
 
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