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Fair Trade certification and social determinants of health : the case of coffee producers in Rwanda Elder, Sara Dawn Whitfield 2010

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FAIR TRADE CERTIFICATION AND SOCIAL DETERMINANTS OF HEALTH: THE CASE OF COFFEE PRODUCERS IN RWANDA by Sara Dawn Whitfield Elder B.A., The University of British Columbia, 2004  A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS in The Faculty of Graduate Studies (Resource Management and Environmental Studies)  THE UNIVERSITY OF BRITISH COLUMBIA (Vancouver) August 2010  © Sara Dawn Whitfield Elder, 2010  ABSTRACT Health of individuals and populations is now understood to be strongly influenced by social conditions and structures, yet health policy remains focused on addressing individual medical and behavioural factors instead of the more fundamental social factors that determine health. Without policies that address the social causes of health, there is a risk of not only imposing interventions that are ineffective, but also missing opportunities to adopt broader societal interventions that could produce significant health benefits for populations. For small-scale agricultural producers, one way to improve the social determinants of health is through certification systems that use production standards, monitoring, certification and labelling to identify and reward items produced under exemplary social conditions. This thesis examines the effects of Fair Trade certification, one of the most established product certification systems, on producers in order to understand its effectiveness as a market-based tool for improving the health of populations. A meta-study of the Fair Trade literature finds evidence that Fair Trade certification positively affects producer health through three main processes: improvement of material conditions (physical capital); better education (human capital); and more extended and robust social networks (social capital). Yet the research design of the reviewed studies limits the ability to conclude that benefits are the effects of certification and not associated with prior cooperative organization resulting in the adoption of certification. These shortcomings in research design were addressed through a case study of Fair Trade certified coffee producers in Rwanda. Given the importance of social structure for health outcomes, the study tested the relative importance of Fair Trade certification versus cooperative organization for producer-level social capital. Regression analyses of farmer survey data and interview responses indicate that both Fair Trade certification and cooperative organization are associated with dimensions of social capital. It seems that prior social organization matters more than certification, and how much more depends on a farmer’s particular experience of his/her producer organization. The research suggests that government and non-governmental organizations may help ensure positive effects of Fair Trade certification on the social determinants of health of producers through interventions that strengthen cooperative producer organizations.  ii  PREFACE Ethics certificate number H09-01749 was obtained from the UBC Behavioural Research Ethics Board (see Appendix A).  iii  TABLE OF CONTENTS ABSTRACT................................................................................................................................... ii PREFACE .................................................................................................................................... iii TABLE OF CONTENTS ............................................................................................................ iv LIST OF TABLES ....................................................................................................................... vi LIST OF FIGURES .................................................................................................................... vii ACKNOWLEDGEMENTS ...................................................................................................... viii CO-AUTHORSHIP STATEMENT ........................................................................................... ix 1  INTRODUCTION ..................................................................................................................1 1.1 1.2 1.3 1.4 1.5  OVERVIEW .........................................................................................................................1 RESEARCH OBJECTIVES AND HYPOTHESES .........................................................................3 METHODOLOGY .................................................................................................................3 THE RWANDAN CONTEXT ..................................................................................................4 REFERENCES ....................................................................................................................10  2 FAIR TRADE CERTIFICATION AND PRODUCER HEALTH: A REVIEW OF THE EVIDENCE ........................................................................................................................ 14 2.1 2.2 2.3  INTRODUCTION ................................................................................................................14 SOCIAL DETERMINANTS OF HEALTH .................................................................................16 VOLUNTARY CERTIFICATION SYSTEMS: FAIR TRADE AS A MEANS OF INFLUENCING SOCIAL DETERMINANTS OF HEALTH .........................................................................................................18 2.3.1 Effects of Fair Trade on physical capital ....................................................................19 2.3.2 Effects of Fair Trade on human capital ......................................................................23 2.3.3 Effects of Fair Trade on social capital ........................................................................24 2.4 FAIR TRADE CERTIFICATION OR COLLECTIVE SOCIAL ORGANIZATION? ............................26 2.5 CONCLUSION ....................................................................................................................31 2.6 REFERENCES ....................................................................................................................33  3 EFFECTS OF FAIR TRADE CERTIFICATION ON SOCIAL CAPITAL: THE CASE OF RWANDAN COFFEE PRODUCERS .................................................................... 38 3.1 INTRODUCTION ................................................................................................................38 3.2 FAIR TRADE AND SOCIAL CAPITAL ...................................................................................40 3.3 METHODS .........................................................................................................................46 3.3.1 Study area ....................................................................................................................46 3.3.2 Sampling method .........................................................................................................49 3.3.3 Data .............................................................................................................................50 3.4 RESULTS ..........................................................................................................................52  iv  3.4.1 Descriptive statistics....................................................................................................52 3.4.2 Regression analyses ....................................................................................................54 3.5 DISCUSSION .....................................................................................................................62 3.6 CONCLUSION ....................................................................................................................65 3.7 REFERENCES ....................................................................................................................67 4  CONCLUSION .....................................................................................................................72 4.1 4.2 4.3 4.4 4.5  5  SUMMARY ........................................................................................................................72 STRENGTHS AND LIMITATIONS OF THE RESEARCH ............................................................73 POTENTIAL APPLICATION OF THE RESEARCH FINDINGS ....................................................74 DIRECTIONS FOR FUTURE RESEARCH ................................................................................75 REFERENCES ....................................................................................................................76  APPENDICES ......................................................................................................................77 APPENDIX A: UBC RESEARCH ETHICS BOARD CERTIFICATE OF APPROVAL ................................77 APPENDIX B: SEMI-STRUCTURED INTERVIEW SCRIPT .................................................................79 APPENDIX C: SURVEY INSTRUMENT ...........................................................................................81  v  LIST OF TABLES Table 2.1: Fair Trade certified and non-certified cooperative effects on social determinants of health ..................................................................................................................................... 28 Table 3.1: Effects on social capital of three types of coffee farmer organization ........................44 Table 3.2: Descriptive statistics ....................................................................................................53 Table 3.3: Social capital summary statistics .................................................................................54 Table 3.4: Sample statistics for logit regression .......................................................................... 56 Table 3.5: Estimation output of perceived increase in trust in community members ..................58 Table 3.6: Estimation output of trust in leaders ............................................................................59 Table 3.7: Estimation output of perceived increase in group participation ..................................60 Table 3.8: Estimation output of perceived increase in group participation of women .................61 Table 3.9: Summary of regression models and their findings ......................................................62  vi  LIST OF FIGURES Figure 2.1: A visual representation of the study focus .................................................................15 Figure 3.1: Rwandan coffee chain from crop to cup ....................................................................48 Figure 3.2: Location of sample sites in Rwanda...........................................................................50  vii  ACKNOWLEDGEMENTS I would like to thank my supervisors, Dr. Philippe Le Billon and Dr. Hisham Zerriffi, for their guidance, support, and constructive conversations. Thank you also to my committee members, Dr. Judy McLean and Dr. Margot Parkes, for their encouragement and insight. The Rwandan farmers who shared their knowledge and experience taught me a lot. I also appreciate the advice and support provided to me by OCIR Café, Sustaining Partnerships to Enhance Rural Enterprise and Agribusiness Development (SPREAD), and others in Rwanda. The hard work of my research assistants and their dedication to the project was motivating. I am grateful to my friends in Rwanda for their generosity and support during my fieldwork. The faculty and students from the Bridge Program and the Institute for Resources, Environment and Sustainability have also supported me throughout my degree. Special thanks to Reza Kowsari for his help and encouragement since the start, to Robin Naidoo for making sense of statistics, and to Jordan Tam for being a star partner in thesis writing. The Social Sciences and Humanities Research Council of Canada and the University of British Columbia Bridge Program provided financial support for this work. Thank you to my family for encouraging me to always pursue what makes me come alive, even when that takes me to distant places. Sara D. W. Elder The University of British Columbia August 2010  viii  CO-AUTHORSHIP STATEMENT Both manuscripts were co-authored with my supervisors, Dr. Hisham Zerriffi and Dr. Philippe Le Billon. I identified and designed the research program with input from my co-authors. I conducted the research, analyzed the data, and drafted the manuscripts. I revised the manuscripts based on discussions with my co-authors.  ix  1 INTRODUCTION 1.1  OVERVIEW  There is now strong empirical evidence that health is determined primarily by the conditions in which people are born, live and work, and the political, social and economic forces that shape these conditions (the social determinants of health) (CSDH, 2008; Marmot & Wilkinson, 2006; Raphael, 2006), yet health policy remains focused on medical and behavioural risk factors and treatment (Raphael, Bryant, & Rioux, 2006). Policies that overlook the social determinants of health risk imposing interventions that are ineffective and of missing opportunities to adopt broader societal interventions that could produce significant health benefits for populations (Link & Phelan, 1995). There are numerous ways in which the social determinants of health can be improved. For smallscale producers of consumable goods, one possible avenue for ensuring that the social determinants of health are improved is through certification systems that use production standards, monitoring, certification and labelling to identify and reward items produced under exemplary social and environmental conditions. Such voluntary certification systems (e.g. organic farming labels, Fair Trade labels, etc.) provide both resources and guidelines for changing conditions within workplaces, households and in the overall community. Certification systems are proliferating most rapidly in the global food sector, as consumers in North America and Europe concerned over the quality of their food choices embrace certifications and labels as a means of influencing environmental, social and health aspects of production (Mutersbaugh, Klooster, Renard, & Taylor, 2005). Fair Trade1 (FT) certification is one of the most established certification systems seeking to ameliorate social, environmental and economic conditions of marginalized producers in the developing world through production and trade standards (Raynolds, Murray, & Heller, 2007). The total world market for Fair Trade certified products is valued at US$ 3.8 billion (Fairtrade Labelling Organization (FLO), 2010). Through this represents a minor share of global trade, the 1  This study uses the term Fair Trade to refer to certification by the Fairtrade Labelling Organizations International (FLO). The term is capitalized in keeping with both academic and popular literature norms. 1  Fair Trade market is growing rapidly; sales increased an average of 40% per year in the last five years (Fairtrade Labelling Organization (FLO), 2010). There are almost 800 Fair Trade certified producer organizations in Latin America, Africa, and Asia selling certified products across North America and Europe (Fairtrade Labelling Organization (FLO), 2010). The FLO now certifies eighteen products, including bananas, tea, sugar, cocoa, honey, and cut flowers, with coffee remaining the most traded commodity (Fairtrade Labelling Organization (FLO), 2010). Fair Trade certification has a direct impact on the one million producers certified as Fair Trade and their dependents – an estimated five million people (Fairtrade Labelling Organization (FLO), 2010). In this context, it is important to examine Fair Trade’s effect on farmers and their families in order to understand product certification’s effectiveness as a market-based tool for improving the health of populations. Research on Fair Trade certification has focused on questions related to the economics of Fair Trade. Studies have examined to what extent certified Fair Trade products present an alternative to conventional markets (see Bassett, 2009; Bitzer, Francken, & Glasbergen, 2008; Raynolds, 2009; Muradian & Pelupessy, 2005; Giovannucci & Ponte, 2005; Mann, 2008), the consequences of Fair Trade products entering mainstream markets (see Bezençon & Blili, 2009; Dolan, 2010; Moore, Slack, & Gibbon, 2006; Raynolds, 2002; Renard, 2005), and consumer behaviour with regards to Fair Trade certified products (see Becchetti & Rosati, 2007; Castaldo, Perrini, Misani, & Tencati, 2009; Pelsmacker, Janssens, Sterckx, & Mielants, 2006; Loureiro & Lotade, 2005). Studies of Fair Trade certification’s impact at the producer level have concentrated on whether producers are getting higher prices for their products (Bacon, 2005; Imhof & Lee, 2007; Levi & Linton, 2003; Murray, Raynolds, & Taylor, 2006; Lyon, 2007; Sick, 2008). Fewer studies assess the social impacts of Fair Trade certification, despite evidence that the non-monetary effects of Fair Trade are at least as important for producer well-being as the economic benefits (Nelson & Pound, 2009). This thesis examines whether Fair Trade certification affects the social determinants of health of producers through two manuscripts that will be submitted to peer-reviewed journals. Chapter 1 introduces the research objectives and provides context for the study. Chapter 2 presents a metastudy of the literature on Fair Trade impacts assessing the evidence of effects of Fair Trade  2  certification on the social determinants of health. A version of Chapter 2 will be submitted to the journal ‘Geoforum’. Chapter 3 examines Fair Trade certification’s effects on social capital, an important determinant of health, through a case study of Rwandan coffee producers. A version of Chapter 3 will be submitted to the journal ‘World Development’. The concluding chapter discusses the relevance of the research findings and directions for future research. 1.2  RESEARCH OBJECTIVES AND HYPOTHESES  The objectives of this thesis are to: •  Identify the ways in which Fair Trade certification can be expected to affect producer health;  •  Identify producer perceptions of the effects of Fair Trade certification on the social determinants of health; and,  •  Identify gaps between the expectations of Fair Trade’s impacts on the social determinants of health based on the literature and producer perceptions of its effects.  The study tests the following hypotheses: •  Fair Trade certification improves the social determinants of health of certified producers.  •  Cooperative organization has a positive effect on the social capital of producers.  •  Fair Trade certification has a positive effect on the social capital of producers above and beyond any effect of cooperative organization.  1.3  METHODOLOGY  The research takes a mixed methods approach to test the study hypotheses. First, a meta-study of the literature on Fair Trade outcomes identified the evidence for Fair Trade certification’s effects on the social determinants of health of certified producers. The meta-study included journal articles, working papers and reports containing case studies of the local-level impacts of Fair Trade certification. Only studies published in English were reviewed. Second, empirical research was conducted in Rwanda to examine the effects of cooperative organization and Fair Trade certification on the social capital of coffee producers.  3  The study focuses on Rwanda because despite the growing number of Fair Trade certified producer organizations in Africa, the impact of Fair Trade in Africa has received little attention to date (Nelson & Pound, 2009). Within Africa, Rwanda has one of the largest numbers of Fair Trade certified coffee producer organizations (FLO-CERT, 2010). Rwanda is also highly dependent on export revenue from coffee, and changes in coffee production affecting social capital may have far-reaching consequences for its population. (Boudreaux, 2010). Finally, the Government of Rwanda’s focus on production of specialty coffee has led to a situation in which there are Fair Trade certified cooperative, non-certified cooperative, and independent farmers all producing a similar quality coffee, which facilitates a comparison between them. In order to distinguish between the effects on producers that are conferred by Fair Trade certification and those that result from prior cooperative social organization, the study sample included Fair Trade certified cooperative producers, non-certified cooperative producers, and producers who sell their coffee to a privately-owned coffee washing station. In the field, semistructured interviews with thirty farmers (see Appendix B for the interview script) informed the design of a quantitative farmer survey (see Appendix C for the survey instrument) and the interpretation of its results. The quantitative survey was conducted with 175 farmers and enabled the identification of the frequency of perceptions, while the qualitative data enhanced understanding of the thought processes that exist behind the perceptions (Morgan, Fischhoff, Bostrom, & Atman, 2002). Open-ended interviews with 12 coffee industry stakeholders in Rwanda provided additional richness and detail to the case study. Analyses and results are provided in the manuscripts and the conclusion; the remainder of the introductory chapter provides background on the Rwandan context and coffee production. 1.4  THE RWANDAN CONTEXT  Rwanda is a small, landlocked country located just south of the equator in eastern central Africa. With a population of over 11 million (Central Intelligence Agency (CIA), 2010), it is one of the most densely populated countries in Africa. The majority of the population is rural, and agriculture remains the backbone of the Rwandan economy. Eighty-one percent of men and 93 percent of women are employed in agriculture, normally on farms smaller than 1.5 hectares.  4  Thirteen percent of the nation’s arable land is used to produce coffee, tea, and some pyrethrum for export. Other crops include bananas, sorghum, beans, peas, maize, fruit and vegetables (International Fund for Agricultural Development (IFAD), 2005). The economy grew rapidly during the 1960s and 1970s, but low coffee prices, overvalued currency and increasing government intervention in the economy slowed growth dramatically in the mid-1980s. The civil war that broke out in Rwanda in 1993 and culminated in the 1994 genocide caused the death of over a million people and hundreds of thousands more to flee their land. Poverty increased as a result; between 2000 and 2007, 76.6 percent of the population lived on less than US $1.25 a day, while 90.3 percent lived on less than US $2 per day. In 2007, life expectancy at birth was 50 years in Rwanda, and 112 children out of every 1,000 died before age five. Malnutrition is widespread; twenty-three percent of children under five years of age are underweight for their age (United Nations Development Programme (UNDP), 2009). Building a high value and market oriented agricultural sector is prioritized as one of six pillars of the Government of Rwanda’s strategy for overcoming poverty by the year 2020 (Ministry of Finance and Economic Planning, 2000). The government is focusing on coffee as a key sector for economic development and poverty reduction (Ministry of Finance and Economic Planning, 2007). Rwanda’s climate, altitude and acidic soils are well-suited to growing coffee, and since its introduction by missionaries in 1904, coffee has been a major source of income for the country. In 2009, coffee exports generated over 36 percent of Rwanda’s total export revenue (Boudreaux, 2010). In the 1930s, colonial authorities made coffee cultivation compulsory and taxed coffee sales (Boudreaux, 2007). The two governments following independence continued to control coffee production, marketing, milling and export through a state coffee agency, OCIR Cafe, which distributed free or subsidized inputs, and through a majority state-owned milling and export company RWANDEX that had a monopoly on coffee exports. Between 1963 and 1989, farmers sold coffee directly to RWANDEX agents at prices pre-determined by OCIR Cafe (Chemonics International Inc., 2006). Verwimp (2003) argues that, in the case of the Habyarimana regime, the government used this coffee price mechanism to buy political loyalty from the rural population. When the International Coffee Agreements that had stabilized coffee prices through  5  mandatory export quotas since 1963 were terminated in 1989, coffee market prices plummeted and the Rwandan government could not continue to provide a high fixed price to coffee farmers. Farmers responded by decreasing production or by ceasing production of coffee completely. In the early 1990s, the Rwandan coffee sector further eroded as farmers were killed or abandoned their land during the civil war. In 1995, the post-war government in Rwanda liberalized the coffee sector as part of a larger government effort to improve economic growth in the country. Farmers became free to choose what to grow, who to sell to, and how to market their product (Boudreaux, 2010). OCIR Café’s role was redefined to develop and monitor strategies for the coffee sector, oversee quality control, and issue certificates of origin. A four percent export tax on coffee allows OCIR Café to continue to provide pesticides and fertilizers and some extension services to coffee farmers (Murekezi, 2009). At present, approximately 400,000 smallholder farmers, 30 percent of whom are women, grow coffee on a total of 28,826 hectares of land (OCIR Cafe, 2009). The average coffee grower tends approximately 180 coffee trees on less than 1 hectare of land. There are no large-scale coffee plantations in Rwanda (International Fund for Agricultural Development (IFAD), 2005). The majority of coffee produced in Rwanda is ‘ordinary’ grade coffee. Farmers hand-pick the coffee cherries during the annual harvest period and de-pulp them manually, then lay the coffee parchment in the sun to dry. Dried coffee parchment is sold to local traders who sell it to several hulling units in Kigali that process the coffee further, removing the parchment and turning the coffee into green coffee ready for export (International Fund for Agricultural Development (IFAD), 2005). Ordinary coffee is a low quality coffee not distinguishable by production process or origin, and is traded as a commodity on the New York Board of Trade “C” market for use in canned pre-ground coffees and for blending (Berndt, 2007). Rwanda cannot produce enough to compete in the large-volume low-quality coffee market due to its small size geographically, and in 2002 the Government of Rwanda started facilitating a shift from producing low quality, ordinary grade coffee to producing specialty coffee, which is significantly different from ordinary coffee (Ministry of Agriculture and Animal Husbandry & Ministry of Trade and Industry, 2008). There is no one definition of specialty coffee, but 6  generally specialty coffees are characterized by unique flavour, origin, high quality, or certification. Fair Trade certified coffee sold as such falls under this category. Instead of being traded on the “C” market, purchase of specialty coffees is negotiated by import and export operators with the coffee producers or producer organizations. As a result, specialty coffee sells for a higher and generally more stable price than ordinary coffee (Berndt, 2007). In Rwanda, a wet processing method is used to obtain a coffee of high enough quality to be sold as specialty coffee. Farmers transport coffee cherries to coffee washing stations immediately after picking, and bad cherries are separated from good cherries by immersion in a tank of water; bad or unripe cherries float, and good cherries sink. Pulp is removed from the good cherries by pressing the fruit by machine through a screen, and then allowing it to ferment in water for a specific period of time. When the fermentation is complete, the coffee is thoroughly washed with clean water, and then sun dried to a water content that is stable for storage (Wintgens, 2009). In Rwanda, coffee washing stations are either privately owned by entrepreneurs or owned by producer cooperatives. Private owners of washing stations buy coffee cherries from independent smallholders who did not invest in the processing equipment (Murekezi & Loveridge, 2009). Other smallholders join together in cooperatives to pool their resources to build a coffee washing station. These cooperatively-owned washing stations buy cherries from the farmers who are also part-owners of the station (Boudreaux, 2010). Twenty percent of the nation’s 400,000 coffee growers belong to one of the nation’s 148 coffee producer cooperatives, a quarter of whom belong to a Fair Trade certified cooperative (OCIR Cafe, 2009). In Rwanda, a cooperative is defined as “an autonomous association of persons united voluntarily to meet their common economic, social and cultural aspirations through a jointly-owned and democratically-controlled enterprise” (Ministry of Commerce, Industry, Investments Promotion, Tourism and Cooperatives, 2007). The cooperative is comprised of a General Assembly of members and a Board of members elected by the General Assembly (Ministry of Commerce, Industry, Investments Promotion, Tourism and Cooperatives, 2006). The government of Rwanda is promoting cooperatives as potential vehicles for employment and access to income generating activities, education and training opportunities. The government recognizes the cooperative as a key organizational form for community development, and places emphasis on their potential for 7  improving gender equality, housing, education, health care, and social integration (Ministry of Commerce, Industry, Investments Promotion, Tourism and Cooperatives, 2007). In order to meet production targets of 19,000 tons of fully-washed coffee by 2012 (Ministry of Agriculture and Animal Husbandry & Ministry of Trade and Industry, 2008), coffee-sector partners have focused on promoting the building of coffee washing stations, strengthening producer cooperatives, improving production techniques, and strengthening the Rwanda brand. The United States Agency for International Development (USAID) has provided technical assistance, training, and financial support to the coffee sector through the non-profit organization ACDI-VOCA, and through the Michigan State and Texas A&M University-led PEARL and SPREAD Projects (Chemonics International Inc., 2006). The International Fund for Agricultural Development (IFAD) also had a seven-year program from 2002 to 2009 that supported the development of coffee washing stations and assisted small scale coffee producer to establish cooperatives and produce high-quality Arabica coffee. In 2008, TechnoServe, an organization that promotes business solutions to poverty, began a four-year project working with Rwandan coffee farmers in the areas of quality coffee production and processing, business management and quality coffee assessment (TechnoServe, 2009). Since 2007, the Clinton Hunter Development Initiative has also been helping coffee farmers to increase their production and sales and to develop their coffee company into a profitable enterprise (Clinton Foundation, 2009). Largely a result of such efforts, the amount of fully-washed coffee in Rwanda has increased from one percent to 20 percent of total coffee production since 2002 (Ministry of Agriculture and Animal Husbandry & Ministry of Trade and Industry, 2008). The three USAID-supported projects also assisted cooperatives in obtaining Fair Trade certification. IFAD conducted an in depth analysis of potential marketing channels for Rwandan coffee and identified Fair Trade certification as a way of developing a market niche for the best quality Rwandan coffee (International Fund for Agricultural Development (IFAD), 2005). IFAD partnered with TWIN, a UK registered charity, to mobilize and train coffee cooperatives in the production and processing practices required to meet Fair Trade certification standards, and to provide management and marketing assistance (International Fund for Agricultural Development (IFAD), 2005). TWIN facilitated FLO certification of the coffee cooperatives, and subsequent  8  contracts between producers and buyers of Fair Trade certified coffee. Between 2002 and 2007, 12 coffee cooperatives in Rwanda received Fair Trade certification (FLO-CERT, 2010). While organizations have been promoting Fair Trade certification in Rwanda, its effects on coffee farmers are not well understood. This thesis provides an important contribution to understanding Fair Trade’s effect in order to better inform government and non-governmental interventions in coffee-producing communities.  9  1.5  REFERENCES  Bacon, C. (2005). Confronting the coffee crisis: Can Fair Trade, organic, and specialty coffees reduce small-scale farmer vulnerability in northern Nicaragua? World Development, 33(3), 497-511. doi:10.1016/j.worlddev.2004.10.002 Bassett, T. J. (2009). Slim pickings: Fairtrade cotton in West Africa. Geoforum, In Press, Corrected Proof. doi:10.1016/j.geoforum.2009.03.002 Becchetti, L., & Rosati, F. C. (2007). Global Social Preferences and the Demand for Socially Responsible Products: Empirical Evidence from a Pilot Study on Fair Trade Consumers. World Economy, 30(5), 807-836. doi:10.1111/j.1467-9701.2007.01012.x Berndt, C. (2007). Is Fairtrade in coffee production fair and useful? Evidence from Costa Rica and Guatemala and implications for policy (Working paper). Mercatus Center: George Mason University. Bezençon, V., & Blili, S. (2009). Fair Trade managerial practices: Strategy, organisation and engagement. 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L., & Lotade, J. (2005). Do fair trade and eco-labels in coffee wake up the consumer conscience? Ecological Economics, 53(1), 129-138. doi:10.1016/j.ecolecon.2004.11.002 Lyon, S. (2007). Fair Trade Coffee and Human Rights in Guatemala. Journal of Consumer Policy, 30(3), 241-261. doi:10.1007/s10603-007-9040-7 Mann, S. (2008). Analysing fair trade in economic terms. Journal of Socio-Economics, 37(5), 2034-2042. doi:10.1016/j.socec.2007.11.002 Ministry of Agriculture and Animal Husbandry, & Ministry of Trade and Industry. (2008). Rwanda national coffee strategy 2009-2012. Retrieved from http://amis.minagri.gov.rw/sites/default/files/user/National_Coffee_Strategy_Rwanda_200 9-2012.pdf Ministry of Commerce, Industry, Investments Promotion, Tourism and Cooperatives. (2006). Sector strategies document: Cooperative sector. Retrieved from http://www.minicom.gov.rw/IMG/pdf/Sector_Strategy-Cooperatives.pdf  11  Ministry of Commerce, Industry, Investments Promotion, Tourism and Cooperatives. (2007). National policy on promotion of cooperatives. Retrieved from http://www.minicom.gov.rw/IMG/pdf/POLICY_DOCUMENT-COPERATIVES.pdf Ministry of Finance and Economic Planning. (2000). Rwanda vision 2020. Retrieved from http://www.cdf.gov.rw/documents%20library/important%20docs/Vision_2020.pdf Ministry of Finance and Economic Planning. (2007). Economic development and poverty reduction strategy 2008-2012. Retrieved from http://siteresources.worldbank.org/INTRWANDA/Resources/EDPRS-English.pdf Moore, G., Slack, R., & Gibbon, J. (2006). The mainstreaming of fair trade : a macromarketing perspective. Journal of Strategic Marketing, 14(4), 329-352. Doi: 10.1080/09652540600947961 Morgan, M. G., Fischhoff, B., Bostrom, A., & Atman, C. J. (2002). Risk Communication: A Mental Models Approach (1st ed.). Cambridge University Press. Muradian, R., & Pelupessy, W. (2005). Governing the coffee chain: The role of voluntary regulatory systems. World Development, 33(12), 2029-2044. doi:10.1016/j.worlddev.2005.06.007 Murekezi, A. (2009). Essays on the effects of coffee market reforms, supply chains, and income improvement in Rwanda (Doctoral dissertation). Michigan State University, East Lansing, MI. Murekezi, A., & Loveridge, S. (2009). Have coffee reforms and coffee supply chains affected farmers' income? The case of coffee growers in Rwanda. In: Agricultural and Applied Economics Association/2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin. Retrieved May 12, 2010, from http://econpapers.repec.org/paper/agsaaea09/49597.htm Murray, D. L., Raynolds, L. T., & Taylor, P. L. (2006). The future of Fair Trade coffee: dilemmas facing Latin America's small-scale producers. Development in Practice, 16(2), 179. doi:10.1080/09614520600562397 Nelson, V., & Pound, B. (2009). The last ten years: A comprehensive review of the literature on the impact of Fairtrade. Natural Resources Institute. OCIR Cafe. (2009). National coffee census 2009 results. Retrieved from http://www.rwandacafe.com/index.php?option=com_content&view=article&id=80&Itemi d=74 Pelsmacker, P. D., Janssens, W., Sterckx, E., & Mielants, C. (2006). Fair-trade beliefs, attitudes and buying behaviour of Belgian consumers. International Journal of Nonprofit and Voluntary Sector Marketing, 11(2), 125-138. doi:10.1002/nvsm.47 Raphael, D., Bryant, T., & Rioux, M. (2006). Staying alive: Critical perspectives on health, illness, and health care. Canadian Scholars' Press. 12  Raynolds, L., Murray, D., & Heller, A. (2007). Regulating sustainability in the coffee sector: A comparative analysis of third-party environmental and social certification initiatives. Agriculture and Human Values, 24(2), 147-163. doi:10.1007/s10460-006-9047-8 Raynolds, L. T. (2002). Consumer/producer links in Fair Trade coffee networks. Sociologia Ruralis, 42(4), 404-424. doi:10.1111/1467-9523.00224 Raynolds, L. T. (2009). Mainstreaming Fair Trade Coffee: From Partnership to Traceability. World Development, 37(6), 1083-1093. doi:10.1016/j.worlddev.2008.10.001 Renard, M. (2005). Quality certification, regulation and power in fair trade. Journal of Rural Studies, 21(4), 419-431. doi:10.1016/j.jrurstud.2005.09.002 Sick, D. (2008). Coffee, farming families, and Fair Trade in Costa Rica: New markets, same old problems? Latin American Research Review, 43(3), 193-208. Solar, O., & Irwin, A. (2007). A conceptual framework for action on the social determinants of health (Backgrounder). Commission on Social Determinants of Health. Retrieved from http://www.who.int/social_determinants/resources/csdh_framework_action_05_07.pdf TechnoServe. (2009). TechnoServe locations Rwanda. Retrieved August 6, 2010, from http://www.technoserve.org/work-impact/locations/rwanda.html United Nations Development Programme (UNDP). (2009). Human development report 2009. Retrieved from http://hdr.undp.org/en/reports/global/hdr2009/ Verwimp, P. (2003). The political economy of coffee, dictatorship, and genocide. European Journal of Political Economy, 19(2), 161-181. doi:10.1016/S0176-2680(02)00166-0 Wintgens, J. N. (2009). Coffee growing, processing, sustainable production: A guidebook for growers, processors, traders, and researchers. Wiley-VCH.  13  2 FAIR TRADE CERTIFICATION AND PRODUCER HEALTH: A REVIEW OF THE EVIDENCE2 2.1  INTRODUCTION  Health of individuals and populations is now understood to be strongly influenced by social conditions, yet health policy remains focused on addressing individual medical and behavioural factors instead of the more fundamental social factors that determine health (Raphael et al., 2006). The social determinants of health are the conditions in which people are born, live and work, and the political, social and economic forces that shape these conditions (CSDH, 2008). Material living conditions, socioeconomic status, and social organization account for general health improvements, health differences among populations within a nation, and differences in health between nations (Raphael, 2006). There is strong empirical evidence of a link between the social determinants of health and specific health outcomes, such as mortality from cardiovascular disease, infections, mental illness, and suicide (Marmot & Wilkinson, 2006). There are numerous ways in which the social determinants of health can be improved. For small-scale producers of consumable goods, one possible avenue for ensuring that the social determinants of health are improved is through certification systems that use production standards, monitoring, certification and labelling to identify and reward items produced under exemplary social and environmental conditions. Such voluntary certification systems (e.g. organic farming labels, Fair Trade labels, etc.) provide both resources and guidelines for changing conditions within workplaces, households and in the overall community. Certification systems are proliferating most rapidly in the global food sector, as consumers in North America and Europe concerned over the quality of their food choices embrace certifications and labels as a means of influencing environmental, social and health aspects of production (Mutersbaugh, Klooster, Renard, & Taylor, 2005). Fair Trade3 certification is one of the most established certification systems seeking to ameliorate social, environmental and economic conditions of marginalized producers in the developing  2  A version of this chapter will be submitted for publication. Elder, S.D., Zerriffi, H., & Le Billon, P. (2010) Fair Trade certification and producer health: A review of the evidence. 14  world through production and trade standards (Raynolds et al., 2007). This meta-study reviews 17 journal articles, working papers and reports containing case studies of the impacts of Fair Trade certification to understand the potential for certification to affect the social determinants of health. Only studies that analyze the local level impacts of Fair Trade and that are published in English are included in the review. Figure 2.1 visualizes the focus of the study. This article does not address the precise mechanisms by which social determinants of health can affect health status as this has been done elsewhere (see, for example, Marmot & Wilkinson, 2006; Raphael, 2006; CSDH, 2008). Instead, it focuses on the effects of Fair Trade certification on the determinants of health with the assumption that effects on these determinants will cause changes in health outcomes.  Figure 2.1: A visual representation of the study focus The following section provides a brief summary of primary evidence to establish broad links between the social determinants of health and health outcomes. A third section gives an overview of Fair Trade certification and presents a review of the evidence for Fair Trade’s effects on the social determinants of health of producers. The fourth section discusses the limitations of current evidence for understanding the impact of Fair Trade certification, and a final section summarizes the study conclusions.  3  This study focuses on the impact of Fair Trade certified products which carry the Fairtrade Labeling Organization (FLO) FAIRTRADE Mark, rather than the impact of the broader social movement termed fair trade. 15  2.2  SOCIAL DETERMINANTS OF HEALTH  Improvements in health outcomes are attributed to the material circumstances in which people are born, live and work, and the political, social and economic forces that shape these conditions (CSDH, 2008). A person’s exposure to material conditions (physical capital) are determined in part by their education and skills (human capital) and social networks (social capital). Material circumstances, such as housing and food, influence the incidence of infection, malnutrition, chronic disease, and injury, as well as cognitive development and mental illness (Raphael, 2006) by shaping early life development and home and working environments (Gordon & Townsend, 2000). High income enhances capacity to access goods and services which promote health benefits, such as clean water, nutritious food, adequate housing, sanitation, education and quality health services (Galobardes, Shaw, Lawlor, Lynch, & Davey Smith, 2006). Sub-optimal living and working conditions may also generate psychosocial stress with subsequent ill-health effects. For example, chronic stress resulting from income, housing and food insecurity has been associated with decreased immune function, increased insulin resistance, greater incidence of lipid and clotting disorders, and other biomedical assaults that are precursors to adult disease (Pham-Kanter, 2009; Wilkinson & Pickett, 2006). In addition, individuals of lower social status in unequal societies may compare their status and possessions with others, and experience feelings of shame and worthlessness, which have psychobiological effects on health (Wilkinson, 2005). Socioeconomic position, the product of a person’s income level but also of their educational achievement, gender, and ethnicity, helps determine material living and working conditions, and is a powerful predictor of heart disease, diabetes, respiratory diseases, and other health outcomes (Smith, 2003). Those positioned at the top of the social hierarchy are healthier than those positioned below them; this correlation between socioeconomic position and health occurs at every level of society, not simply at the poorest level (Marmot, 2005; Valle, 2009). Education is often used as a measure of socioeconomic position since it reflects the material and intellectual resources of a person’s parents and influences employment in adulthood. Education is also associated with health outcomes through its effect on people’s capacity for learning and  16  understanding health education messages and their ability to communicate with health services (Galobardes et al., 2006). Like material possessions (physical capital) and education (human capital), social networks and the associated norms of reciprocity and trustworthiness (social capital) affect health outcomes (Putnam & Goss, 2004). Networks, norms and trust enable individuals to act together more effectively to pursue shared objectives (Putnam, 1995). A person can draw on family, friends and associates for emotional and material support in a crisis, and communities with high social capital have greater capacity to confront poverty, resolve disputes, and take advantage of new opportunities (Woolcock & Narayan, 2000). As a consequence, indicators of social capital, such as level of trust and organizational membership, have been linked to decreased mortality, better physical and mental self-reported health status, decreased violence, and improved health practices and behaviours (Mitchell & Bossert, 2007). Because it is a basis for discrimination in many societies, gender influences socioeconomic status and social capital. Women’s lack of access to power, prestige, and resources results in health consequences such as female infanticide, rape, and domestic violence, and disproportionately high rates of HIV infection (Nancy Krieger, 2001). Socially constructed racial or ethnic differences are another basis of discrimination, and individuals belonging to marginalized racial or ethnic groups experience negative health outcomes as a result of their low social status (N Krieger, Williams, & Moss, 1997). For example, the life expectancy of African-Americans in the United States is significantly lower than for white Americans (United Nations Development Programme (UNDP), 2009). Without policies that address the social causes of health, there is a risk of not only imposing interventions that are ineffective, but also missing opportunities to adopt broader societal interventions that could produce significant health benefits for populations (Link & Phelan, 1995). Most interventions and policies addressing the social determinants of health focus on the material factors, and only target one determinant, without relation to other social determinants (Solar & Irwin, 2007). Interventions to improve health must address both living conditions and alter social structure and organization to reduce the exposure of disadvantaged social groups to health-damaging factors (Solar & Irwin, 2007). 17  2.3  VOLUNTARY CERTIFICATION SYSTEMS: FAIR TRADE AS A MEANS OF INFLUENCING SOCIAL DETERMINANTS OF HEALTH  Certification systems that aim to improve well-being and alter social structures through economic, social, and environmental production standards for various commodities in the manufacturing and agricultural sectors have the potential to improve the social determinants of health of producers. Fair Trade certification is one of the most well-established certification systems (Raynolds et al., 2007). By requiring buyers to pay a stable minimum price and a social premium to producer organizations, and providing an opportunity for pre-financing and longterm contracts, Fair Trade economic standards aim to improve financial stability of producer organizations and reduce variability of producer incomes. With regards to the environment, Fair Trade stipulates minimised and safe use of agrochemicals, proper and safe management of waste, maintenance of soil fertility and water resources, and prohibits use of genetically modified organisms. Only democratically organized small-scale producer groups can get Fair Trade certification; these organizations must be set up in a transparent way and must not discriminate against any particular member or social group (Fairtrade Labelling Organization (FLO), 2010). Because these standards address immediate well-being and social structures, Fair Trade can be expected to have an important effect on the health outcomes of certified producers. Fair Trade certification has its roots in a larger Fair Trade movement that started in the 1940s when churches in North America and Europe initiated projects to improve the social and economic conditions of marginalized producers in the developing world by selling their handicrafts to developed country consumers directly and at higher prices than conventional trading structures. In 1988, the first Fair Trade label, the Max Havelaar label out of the Netherlands, offered the mainstream coffee industry the opportunity to adopt standardized Fair Trade criteria. In 1997, the Max Havelaar label was brought together with Fair Trade labels that had developed subsequently in other countries to create the Fair Trade Labelling Organizations (FLO), an international umbrella organization for standardizing Fair Trade labelling (Jaffee, 2007). Twenty national initiatives in Europe, North America, and the Pacific make up the FLO, five of which belong to the elected board, along with four producer groups, two importers, and two consumer group representatives. A standard-setting unit at FLO establishes the Fair Trade  18  certification criteria, and the independent, ISO 65-compliant organization FLO-Cert certifies and monitors producers and importers for compliance with these standards. The total world market for Fair Trade certified products is valued at US$ 3.8 billion (FLO, 2010). Through this represents a minor share of global trade, the Fair Trade market is growing rapidly; sales increased an average of 40% per year in the last five years (FLO, 2010). There are almost 800 Fair Trade certified producer organizations in Latin America, Africa, and Asia selling certified products across North America and Europe (FLO, 2010). The FLO now certifies eighteen products, including bananas, tea, sugar, cocoa, honey, and cut flowers, with coffee remaining the most traded commodity (Jaffee, 2007). Fair Trade impacts an estimated five million people – one million certified producers and their dependents (FLO, 2010). In this context, it is important to examine Fair Trade’s effect on farmers and their families in order to understand product certification’s effectiveness as a market-based tool for improving the health of populations. Research on the outcomes of Fair Trade for producers has focused on questions related to the economics of Fair Trade. Many studies address whether producers are getting higher prices for their products (Bacon, 2005; Imhof & Lee, 2007; Levi & Linton, 2003; Lyon, 2007; Murray et al., 2006; Sick, 2008), but few assess the social impacts of Fair Trade in any great depth, despite indications that the non-monetary effects of Fair Trade are at least as important for producer well-being as the economic benefits (Nelson & Pound, 2009). This article starts to address the gap in the literature by examining Fair Trade’s effect on the social factors that influence producer health. The following section discusses the evidence for Fair Trade’s effect on the major social determinants of health. The literature suggests that Fair Trade’s social impacts may be the most important for producer well-being, due mainly to the cooperative organization of producers. However, the way most studies are designed limits the ability to understand whether the social impacts are a result of certification or a result of the cooperative organization itself. 2.3.1 Effects of Fair Trade on physical capital Evidence in the Fair Trade literature indicates that Fair Trade certification positively affects the social determinants of health through three main processes: improvement of material conditions  19  (physical capital); better education (human capital); and more extended and robust social networks (social capital). The higher price paid to certified producers is cited as the most direct benefit from Fair Trade certification contributing to improved material living conditions (Raynolds, Murray, & Leigh Taylor, 2004). Perezgrovas and Cervantes (2002) maintain that producer prices can be 200 to 300 percent more than prices from local coffee merchants. Using a regression model, Arnould, Plastina, and Ball (2009) corroborate the claim that Fair Trade producers obtain higher prices than non-certified producers. Fair Trade has been associated with positive average net household incomes (Ruben, Fort, & Zuniga, 2008), and as a result of higher prices, Fair Trade producers can have higher incomes than non-Fair Trade producers (Imhof & Lee, 2007; Ronchi, 2006). However, in order to understand the impact of Fair Trade on producer income, there is a need to distinguish between the cooperative price (the price the cooperative receives from the buyer) and the producer price (the price the producer receives from the cooperative), and to know the proportion of exports sold as Fair Trade and whether the producer is a member of a cooperative. The Fair Trade guaranteed price standard applies at the cooperative level; once transportation, processing, export, certification, debt repayment, and other cooperative costs (which may benefit producers indirectly, and in the longer term) are deducted, the price to farmers can be less than the Fair Trade market price (Utting, 2009; Utting-Chamorro, 2005). In his study of Nicaraguan coffee farmers, Bacon (2005) found that certification has a more positive and significant effect on cooperative price than altitude, a proxy for coffee quality, but does not specify whether this translates into a higher producer price. Utting (2009) claims that Fair Trade certification can still increase producer incomes, even when close to half of the income from the Fair Trade market price is retained at the cooperative level. When farmers sell to the conventional market in addition to the Fair Trade market, which is usually the case, then the average price for all the coffee sold by the producer can be significantly less than Fair Trade prices (Bacon, 2005; OPM & IIED, 2000). On the other hand, Berndt (2007) points out that in Costa Rica and Guatemala, coffee farmers sometimes may sell their best quality beans on the open specialty market instead of Fair Trade, for higher prices. Whether producers are organized also has an effect on price; cooperative organization provides  20  producers with a large advantage over unorganized producers which is related to economies of scale and not to Fair Trade certification. Perezgrovas and Cervantes’ (2002) calculated increase in producer prices decreases from 200 to 300 percent to 52 to 131 percent when Fair Trade certified cooperative members are compared to organized producers selling to the mainstream market instead of to unorganized producers selling to local intermediaries (Fend, 2005). Thus, although producers appear to benefit financially from Fair Trade certification, this benefit is somewhat diminished after considering all other transaction costs and may not be wholly related to certification itself, but to the effect of democratic producer groups. There is evidence that Fair Trade certified producers are experiencing improved living conditions as a result of the financial benefit from Fair Trade certification. Fair Trade certified coffee producers in Nicaragua expanded the number of rooms in their houses and improved toilet facilities with the increased income they earned from Fair Trade coffee sales (Utting, 2009). The incomes from Fair Trade sales are also used by producers to access health care, to improve water quality, to purchase electricity to replace wood fuel, and to purchase improved cook stoves, food, farming inputs and labour, clothing and shoes, school supplies, and telephones (Arnould et al., 2009; Raynolds et al., 2004; Utting, 2009; Utting-Chamorro, 2005). Bechetti and Constantino (2008), for example, found significantly higher monthly food consumption and dietary quality for Fair Trade farmers versus non-Fair Trade farmers. Jaffee (2007) also learned that Fair Trade producers in Mexico were eating more protein and nutritious foods than their conventional counterparts. Arnould et al. (2009) found that members of Fair Trade certified organizations are more able to receive medical treatment when needed than non-certified farmers, and that longterm Fair Trade participants have better access than short-term participants. Fair Trade certification betters material conditions at the workplace by contributing to a general improvement of the environment through its environmental standards (Raynolds et al., 2004). Most producer groups fund training on environmental issues and sustainable agricultural practices (Imhof & Lee, 2007; Raynolds et al., 2004). Cooperatives in Mexico built farmer training centres in sustainable agriculture (Raynolds et al., 2004), and a producer organization in Costa Rica started an initiative in its community to “improve the standard of living of small, rural coffee farmers in harmony with nature, through economic support and follow-up of various  21  projects which focus on sustainable production and environment” (Ronchi, 2002). Fair Trade certified coffee producers are adopting more environmentally friendly farming techniques, such as soil conservation, water quality management and mechanical weed clearing (UttingChamorro, 2005). Cooperatives can improve the environment by using the Fair Trade premium to support organic certification by paying certification fees, funding organic trial plots, and educating members in organic production techniques (Calo & Wise, 2005; Murray, Raynolds, & Taylor, 2003; Parrish, Luzadis, & Bentley, 2005; Raynolds et al., 2004), which are more stringent than Fair Trade environmental criteria (Raynolds et al., 2007). Farmers have changed from having little understanding of the environmental effects of their work to becoming very aware of their production techniques (Utting, 2009). Their change in agricultural practices seems to have occurred in part due to their understanding that environmental protection has health benefits; small producers in Nicaragua told researchers they were interested in conservation to allow their children to breathe cleaner air (Utting, 2009). Several studies state the psychological benefits of Fair Trade certification’s material impact (Renard, 2005; Utting-Chamorro, 2005). Fair Trade certified farmers know that they will receive at least a certain income at harvest, and can plan for coffee and other crop production as well as household needs for that year (Murray et al., 2003). For instance, Fair Trade certified coffee producers in Costa Rica perceived improved stability and security in their lives (Ronchi, 2002). Without access to Fair Trade markets, conventional producers do not know how much money they will have until they sell their coffee (Perezgrovas & Cervantes, 2002). While most impact studies state the benefits of Fair Trade for living and working conditions, there are several that suggest Fair Trade’s effect on living and working conditions alone is inadequate. The financial benefit from Fair Trade may not improve farmers’ position in society; standards can create barriers to entry for the poorest producers who may not be able to afford the membership fee to join a cooperative or who live in remote areas (Dolan, 2010; Giovannucci & Ponte, 2005; Jaffee, 2007). Fair Trade cooperative members have expressed concern that certification may be benefiting the most established farmer cooperatives instead of the most marginalized (Taylor, 2005). Parrish et al. (2005) argue that many of the toxic chemicals prohibited by Fair Trade are not used for coffee production, so Fair Trade’s standards may not  22  play a large role in protecting the environment, at least in the case of coffee. Dolan (2010) points out that the Fair Trade social premium can be used to build dispensaries and health clinics, but this may improve access to healthcare only when there are the necessary personnel and supplies required to keep the dispensaries and clinics operational. Material benefits are important for producer well-being, but producers’ ability to act together to pursue shared objectives may be more significant; for example, to organize to have personnel at the local medical clinic. Thus it is crucial to look at how Fair Trade certification affects socioeconomic position and social capital of producers, as these influence their ability to take advantage of the material benefits of Fair Trade. 2.3.2 Effects of Fair Trade on human capital Higher income may help improve social status of producers through its effects on education. Arnould et al. (2009) ran a regression analysis of the level of education of coffee producers and found no direct effects of Fair Trade participation on education level, but a significant indirect effect of Fair Trade membership on educational attainment through higher coffee income. Fair Trade farmers in Guatemala are able to send their children to school, and occasionally to university, in greater numbers than non-certified farmers. Nicholls and Opal (2005) hypothesize that higher incomes from participation in Fair Trade also mean producers can pay workers to harvest crops, freeing their children from farm work to attend school. Raynolds et al. (2004) report that in almost all the cooperatives they researched, producers allowed their children to remain in school during the coffee harvest, but it is unclear whether this is due to increased ability to hire wage labourers. In addition to the educational benefits from increased income, the Fair Trade premium makes it possible for cooperatives to finance education programmes in their communities (Milford, 2004; Murray et al., 2003; Paul, 2005). This includes support for formal education, as in the case of Coocafe in Costa Rica, which has an Educational Extension Fund that provides improved physical infrastructure and teaching materials for marginalized rural schools in member communities, and offers secondary school and university scholarships to its members and their children (Ronchi, 2002). More often, cooperative education programmes offer training courses to members to develop alternative incomes sources such as artisanry (Murray et al., 2003), to 23  improve production techniques (Paul, 2005; Utting, 2009), and to increase awareness of international market and quality specifications (Raynolds et al., 2004), including Fair Trade issues and effective marketing techniques (Utting-Chamorro, 2005). Fair Trade producers in Bolivia, for instance, understand coffee production processes and the coffee market better than their non-certified counterparts as a result of their cooperatives offering regular training courses on topics such as the coffee market, environmental issues, and administrative and financial management (Imhof & Lee, 2007). 2.3.3 Effects of Fair Trade on social capital Several studies claim that Fair Trade certification, in addition to human capital, facilitates the building of social capital, or social networks, which can result in collective action and civic engagement (Lyon, 2007; Mendez, 2002). Shared work and regular meetings of cooperative members help create a cooperative ethos (Pirotte, Pleyers, & Poncelet, 2006) and a sense of identity and community (Moberg, 2005). Pirotte et al. (2006) maintain that the sense of solidarity generated within the producer organizations is probably the most important impact of Fair Trade certification. Fair Trade’s non-discrimination standard may contribute to solidarity by improving gender relations and racial or ethnic equality. Gender inequality still prevails in Fair Trade certified coffee-farming communities in Nicaragua, but the majority of study participants reported an increase in men’s share of domestic housework and a decrease in the number of cases of violence against women in the community (Utting, 2009). Cooperative trainings and cooperative meetings and workshops also appear to empower women producers; the position of women is changing as they build self-confidence and management capabilities (UttingChamorro, 2005). Interviewees reported to Utting (2009) that their cooperative’s gender focus has been successful in providing women with the necessary knowledge and skills to produce their own “Las Hermanas” (women’s) high-quality coffee, and women have moved from a situation of not having any involvement in coffee production to having more input in generating household income. Overall, evidence supports Paul’s (2005) claim that Fair Trade’s attention to gender issues has important effects, though it may not achieve a situation where women are considered on an equal basis with their male counterparts (Ronchi, 2002). The effects of Fair Trade certification on ethnic equality have not been addressed directly in the literature. However, research on coffee cooperatives and reconciliation among ethnic groups following the 1994 24  genocide in Rwanda provides some insight into the effects of cooperatives on member relations; membership in a coffee cooperative, and “frequent, deep, and pleasant contact” with members from the other ethnic group correlated with positive attitudes toward reconciliation (Boudreaux & Tobias, 2009). In some cases, solidarity extends past cooperative members to encompass the general manager of the organization and buyers (Utting, 2009). A Nicaraguan cooperative helped its member communities obtain funding from international agencies or buyers to supplement the Fair Trade premium for development projects (Utting, 2009). Individual producers can more easily access other opportunities, such as relief funds in the case of a natural disaster, when they are organized into a cooperative and have global links from Fair Trade (Murray et al., 2003). Fair Trade can increase cooperatives’ links with global coffee buyers, leading to benefits from name recognition in consuming countries, long-term relationships with partners, and access to market information (Kilian, Pratt, Jones, & Villalobos, 2004; Murray et al., 2003; Parrish et al., 2005). Private initiatives appear to do less to assist in making such connections (Parrish et al., 2005). Commitment to Fair Trade standards may promote broad producer participation in the cooperative and the community (Raynolds et al., 2004). Bassett’s study (2009) of Fair Trade certified cotton growers in West Africa found that while women are generally excluded from conventional cotton growing, Fair Trade certified cotton-growing organizations took measures to ensure equal membership of women, improving women’s access to cash cropping opportunities (Bassett, 2009). Bacon (2005) measured participation and decision-making within Fair Trade cooperatives and found that coffee-growing households exploit relationships at multiple levels – the household, family network, and cooperative organization – to cope with crisis. This represents an empowering approach to reducing vulnerability promoted by Fair Trade’s certification standards (Utting, 2009). Raynolds et al. (2004) argue that Fair Trade’s most positive impacts come from the role it plays in individual and collective empowerment. Taylor (2005) cites producer empowerment and consequent increases in civic participation as an effect of Fair Trade certification, although there are difficulties in attributing these to Fair Trade per se, because cooperative organization has been shown to promote the development of social capital, empowerment, and democratization (Milford, 2004). Membership in a Fair Trade cooperative  25  can, however, be a unique opportunity to be part of a nonpartisan democratic community organization (Moberg, 2005). For example, cooperative members vote to retain income to be used on business development (organic conversion, technical training for quality improvements, etc.) (Renard, 2005). The participation of members of a cooperative in Nicaragua, both at the cooperative level and in their community, increased once the organization became Fair Trade certified; producers became more active in development, health and peace committees, in school committees, and had increased interactions with local and international non-governmental organizations operating locally (Utting, 2009). 2.4  FAIR TRADE CERTIFICATION OR COLLECTIVE SOCIAL ORGANIZATION?  The evidence reviewed above regarding Fair Trade’s effects on physical capital, human capital, and social capital indicates generally positive effects of Fair Trade certification on farmers. However, there are three potential issues with drawing the conclusion that these benefits, particularly the human capital and social capital benefits, result primarily from Fair Trade certification. First, the effects may be associated with participation in a cooperative organization and not Fair Trade certification per se. Second, most studies implicitly assume that cooperative organization follows Fair Trade certification when, in fact, the cooperative predates certification. Third, in determining overall effects of Fair Trade certification, most studies – particularly studies of coffee – do not account for the quality of the certified product and its effect on outcomes (e.g. income). Each of these issues is discussed in turn. A majority of the research on Fair Trade impacts does not distinguish between the effects of certification versus the effects of cooperative organization on producers, making it difficult to know whether many of the benefits to producers are the result of certification or social organization. Several studies account for differences in producer experience with Fair Trade, for example, by selecting certified cooperatives representative of geography, size and number of years certified (Murray et al., 2003; Ronchi, 2002). More generally they involve qualitative interviews and focus groups with Fair Trade certified cooperative members and leaders, and various key informants from purchasing and retailing companies, consumers of Fair Trade products, and non-governmental organizations (Calo & Wise, 2005; Dolan, 2010; Lyon, 2007; Milford, 2004; Moberg, 2005; Raynolds, 2009; Ronchi, 2002; Utting, 2009; Utting-Chamorro, 26  2005). Table 3.1 summarizes the evidence for Fair Trade certification’s effects on social determinants of health, and hypothesizes that cooperative producer organization is in fact responsible for many of the effects on the social determinants of health.  27  Table 2.1: Fair Trade certified and non-certified cooperative effects on social determinants of health Social determinant of health  Material conditions  Education  Fair Trade certified cooperative  Non-certified cooperative  Higher price and income resulting from minimum guaranteed price (Arnould et al., 2009; Bacon, 2005; Fend, 2005; Imhof & Lee, 2007; Perezgrovas & Cervantes, 2002; Raynolds et al., 2004; Ronchi, 2002; Ruben et al., 2008; Utting, 2009; UttingChamorro, 2005)  Higher price and income resulting from fewer middlemen and better access to markets due to economies of scale (Boudreaux, 2007; Milford, 2004)  Standards create barriers to entry for poorest producers (Dolan, 2010; Jaffee, 2007; Taylor, 2005)  Cooperative membership fee creates barrier to entry for poorest producers (Milford, 2004)  Improved housing conditions (Raynolds et al., 2004; Utting, 2009; Utting-Chamorro, 2005)  Improved housing conditions resulting from higher income (author’s hypothesis)  Improved access to health care (Arnould et al., 2009)  Improved access to health care resulting from higher income (author’s hypothesis)  Improved water quality and better nutrition (Arnould et al., 2009; Becchetti & Costantino, 2008; Jaffee, 2007; Raynolds et al., 2004; Utting-Chamorro, 2005)  Improved water quality and better nutrition resulting from higher income (Boudreaux, 2010)  General improvement of environmental conditions resulting from environmental standards (Raynolds et al., 2004). Not in the case of coffee (Parrish et al., 2005)  Improvement of environmental conditions resulting from government and non-governmental projects partnering with cooperative (author’s hypothesis)  Financial security resulting from minimum guaranteed price (Murray et al., 2003; Perezgrovas & Cervantes, 2002; Ronchi, 2002)  Do not know what price will receive at harvest (Perezgrovas & Cervantes, 2002)  Higher income improves educational attainment through increased ability to pay school fees, buy uniforms and supplies (Arnould et al., 2009)  Higher income improves educational attainment through increased ability to pay school fees, buy uniforms and supplies (author’s hypothesis)  Higher income means producers can hire workers to harvest, freeing children to attend school (Nicholls & Opal, 2005)  Higher income means producers can hire workers to harvest, freeing children to attend school (author’s hypothesis)  Premium used to finance formal education programmes (Milford, 2004; Ronchi, 2002)  Cooperative profit used to support community projects such as improved schools (Boudreaux, 2010)  28  Social determinant of health  Social networks  Fair Trade certified cooperative  Non-certified cooperative  Premium used to finance trainings (Imhof & Lee, 2007; Murray et al., 2003; Paul, 2005; Raynolds et al., 2004; Utting, 2009; Utting-Chamorro, 2005)  Trainings financed by government, industry and/or development agencies (Boudreaux, 2010)  Democratic producer organization facilitates building of social networks and trust (Moberg, 2005; Pirotte et al., 2006; Utting, 2009)  Democratic producer organization facilitates building of social networks and trust (Milford, 2004; Boudreaux, 2010)  Fair Trade organizations and democratic producer organization facilitate links to foreign buyers and organizations (Kilian et al., 2004; Murray et al., 2003; Parrish et al., 2005; Utting, 2009)  Organization of producers and quantity/quality of coffee make it easier to link farmers to foreign buyers and organizations (Boudreaux, 2010)  Producer organization facilitates collective action (Lyon, 2007; Mendez, 2002; Pirotte et al., 2006)  Cooperative organization facilitates collective action (Milford, 2004)  Producer organization facilitates civic participation (Bacon, 2005; Moberg, 2005; Raynolds et al., 2004; Renard, 2005; Taylor, 2005; Utting, 2009)  Cooperative organization facilitates civic participation (Milford, 2004)  Democratic producer organization and non-discrimination standard improve position of women (Bassett, 2009; Ronchi, 2002; Utting, 2009; Utting-Chamorro, 2005)  Democratic producer organization improves gender equality (author’s hypothesis)  Democratic producer organization and non-discrimination standard improve ethnic equality (author’s hypothesis)  Democratic producer organization improves ethnic equality (Boudreaux & Tobias, 2009)  29  Most studies of Fair Trade implicitly assume that because membership in a democratic organization of small producers is a requirement for Fair Trade certification, certification is the cause of the organization. Instead, organizations generally seek Fair Trade certification because their members wish it. Cooperatives are a means for farmers to advance their interests in the Fair Trade arena and elsewhere; the cooperatives provide access to resources and opportunities that would otherwise be unattainable for their members, including but not limited to those associated with the Fair Trade market. Cooperatives are necessary intermediaries between producers and international markets (Zelmer, 2006), and the key to understanding the influence of Fair Trade certification on the health outcomes of producers. Several researchers have studied Fair Trade cooperative members versus non-cooperatively organized farmers, but few have compared Fair Trade certified cooperative members to non-Fair Trade certified cooperative members. For example, Jaffee (2007) compared a small number of Mexican coffee farmers who sell to Fair Trade certified cooperatives with unorganized farmers who sell to local intermediaries. The two types of farmers surveyed by Arnould et al. (2009) included farmers who were members of Fair Trade cooperatives selling at least 30 percent of their production to Fair Trade for at least three years, and independent coffee farmers, but who were not necessarily affiliated with a cooperative. Bassett (2009) interviewed groups of Fair Trade certified and conventional cotton growers in West Africa, but it is unclear whether the conventional farmers were organized in cooperatives. In his study of Nicaraguan coffee producers, Bacon (2005) surveyed 180 members of certified coffee cooperatives, and 48 non-certified cooperative members, but does not distinguish between Fair Trade, organic, and bird friendly certification. Only one study was found that compares members of Fair Trade certified cooperatives with members of non-certified cooperatives. Parrish et al. (2005) interviewed over 100 producers, as well as key informants, from both Fair Trade certified and non-certified cooperatives supported by the NGO Technoserve, but because a benchmark population is not included in the study, it is difficult to distinguish the benefits of cooperative organization from the benefits of selling a high quality coffee. This is a common limitation of the several studies of Fair Trade that do compare Fair Trade certified producers to non-certified growers; they do not account for differences in product  30  quality. In the case of coffee, quality matters because superior quality coffee fetches a price premium on the conventional market, but does not necessarily add a premium to the Fair Trade price (Fend, 2005). Imhof and Lee (2007) compare two Fair Trade certified cooperatives with two private companies, one selling organic coffee, and one selling to the conventional market, and Arnould et al. (2009) designed their survey methodology as a controlled comparison of Transfair USA cooperative participants and non-Fair Trade certified farmers in three countries. Neither study is clear on whether the Fair Trade product is equivalent to the conventional product in all ways apart from being certified. 2.5  CONCLUSION  In recent years, there has been a rise in the popularity and economic value of product certification systems, including Fair Trade certification, that provide both resources and guidelines for changing conditions within households, workplaces, and communities. The available evidence suggests that Fair Trade certification can improve producer health by advancing the material living and working circumstances of producers, improving the education of producers, and altering social organization. However, it is hypothesized that cooperative social organization can account for many of the material, educational, and social benefits normally ascribed to Fair Trade certification. Cooperative organization alone can create economies of scale and so increase income of small scale producers, though by not guaranteeing a minimum price it may not provide financial security to farmers. Non-certified producers likely spend their income similarly to Fair Trade certified producers, on housing, health insurance, water quality and nutritious food, improving their material living conditions as a result. Cooperatives can facilitate industry, government, and non-governmental organization access to the population, which may attract environmental projects that lead to improved working conditions of producers. Industry, government and development agencies may also offer other trainings to producers through their cooperative organization. Since non-certified cooperatives do not receive the Fair Trade social premium, they may not be able to provide formal educational programmes, but may have improved educational attainment due to increased ability to pay school fees and supplies.  31  Many of the social capital benefits attributed to Fair Trade certification may actually be the result of cooperative producer organization. By bringing producers together, cooperatives can foster social networks, trust in cooperative members, collective action and group participation. The non-certified producer organization may also improve equality among members due to the democratic nature of a cooperative. The organization of producers and economies of scale may also make it easier for farmers to link with foreign buyers and non-governmental organizations. Despite the limitations of the reviewed studies in distinguishing between Fair Trade certification and cooperative organization as the main factor affecting social determinants of health, the evidence suggests that Fair Trade certification is a useful tool through which governments and organizations can promote cooperative organization and affect the social determinants of health of small-scale producers. Further research is required in order to understand whether the benefits to producer determinants of health are a function of Fair Trade certification or due to the form of social organization. Future studies should compare Fair Trade certified cooperative members to non-certified cooperative members, and include a benchmark group of independent farmers, to differentiate the effects of certification from the effects of social organization, and account for product quality by ensuring that the product of interest is equivalent in all ways other than certification for the comparison groups.  32  2.6  REFERENCES  Arnould, E. J., Plastina, A., & Ball, D. (2009). Does Fair Trade deliver on its core value proposition? Effects on income, educational attainment, and health in three countries. Journal of Public Policy & Marketing, 28(2), 186-201. doi:10.1509/jppm.28.2.186 Bacon, C. (2005). Confronting the coffee crisis: Can Fair Trade, organic, and specialty coffees reduce small-scale farmer vulnerability in northern Nicaragua? World Development, 33(3), 497-511. doi:10.1016/j.worlddev.2004.10.002 Bassett, T. J. (2009). Slim pickings: Fairtrade cotton in West Africa. 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Staying alive: Critical perspectives on health, illness, and health care. Canadian Scholars' Press. Raynolds, L., Murray, D., & Heller, A. (2007). Regulating sustainability in the coffee sector: A comparative analysis of third-party environmental and social certification initiatives. Agriculture and Human Values, 24(2), 147-163. doi:10.1007/s10460-006-9047-8 Raynolds, L. T. (2009). Mainstreaming Fair Trade coffee: From partnership to traceability. World Development, 37(6), 1083-1093. doi:10.1016/j.worlddev.2008.10.001 Raynolds, L. T., Murray, D., & Leigh Taylor, P. (2004). Fair trade coffee: Building producer capacity via global networks. Journal of International Development, 16(8), 1109-1121. doi:10.1002/jid.1136 Renard, M. (2005). Quality certification, regulation and power in fair trade. Journal of Rural Studies, 21(4), 419-431. doi:10.1016/j.jrurstud.2005.09.002 Ronchi, L. (2002). 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A conceptual framework for action on the social determinants of health (Backgrounder). Commission on Social Determinants of Health. Retrieved from http://www.who.int/social_determinants/resources/csdh_framework_action_05_07.pdf Taylor, P. L. (2005). In the market but not of it: Fair Trade coffee and forest stewardship council certification as market-based social change. World Development, 33(1), 129-147. doi:10.1016/j.worlddev.2004.07.007 United Nations Development Programme (UNDP). (2009). Human development report 2009. Retrieved from http://hdr.undp.org/en/reports/global/hdr2009/ Utting, K. (2009). Assessing the impact of Fair Trade coffee: Towards an integrative framework. Journal of Business Ethics, 86(0), 127-149. doi:10.1007/s10551-008-9761-9 Utting-Chamorro, K. (2005). Does fair trade make a difference? The case of small coffee producers in Nicaragua. Development in Practice, 15(3), 584. doi:10.1080/09614520500075706 Valle, A. M. (2009). Social class, marginality and self-assessed health: A cross-sectional analysis of the health gradient in Mexico. International Journal for Equity in Health, 8, 3-3. doi:10.1186/1475-9276-8-3 Wilkinson, R. G., & Pickett, K. E. (2006). Income inequality and population health: A review and explanation of the evidence. Social Science & Medicine, 62(7), 1768-1784. doi:10.1016/j.socscimed.2005.08.036 Wilkinson, R. G. (2005). The impact of inequality: how to make sick societies healthier. Routledge. Woolcock, M., & Narayan, D. (2000). Social capital: Implications for development theory, research, and policy. World Bank Res Obs, 15(2), 225-249. doi:10.1093/wbro/15.2.225 Zelmer, M. (2006). Cooperative solutions : How the Fair Trade and organic coffee markets support forested ecosystems on Nicaraguan coffee farms (Doctoral dissertation). The University of British Columbia, Vancouver, BC.  37  3 EFFECTS OF FAIR TRADE CERTIFICATION ON SOCIAL CAPITAL: THE CASE OF RWANDAN COFFEE PRODUCERS4 3.1  INTRODUCTION  During the last decades, there has been a rise in empirical evidence showing the positive effects of social capital on a range of social problems (Grootaert, 2004). Social capital can be defined as “social networks, the reciprocities that arise from them and the value of these for achieving mutual goals” (Schuller, Baron, & Field, 2000). It has both cognitive manifestations, such as trust in others and norms of reciprocity, and structural manifestations, such as participation in voluntary organizations (Grootaert, Bastelaer, & Bank, 2002). Social capital can be bonding or bridging; bonding social capital refers to connections to people that share a similar social identity, while bridging social capital involves connections across explicit or institutionalized power gradients in society to people in influential positions (Szreter & Woolcock, 2004). Social capital has been linked to important social outcomes like decreased crime, child welfare, better health, more effective government administration, lower political corruption, reduced tax evasion, enhanced market performance, and improved educational achievement (Putnam, 2001; Sampson, Raudenbush, & Earls, 1997; Verba, Schlozman, & Brady, 1995; Woolcock, 2001). Given the wealth of evidence showing the positive effects of social capital, it is important to have an understanding of ways to foster social capital in communities. Studies of Fair Trade5 certification indicate that it has significant effects on social capital. Fair Trade is a voluntary product certification system designed to ameliorate social, environmental and economic problems of marginalized producers in the developing world through production and trade standards (Raynolds et al., 2007). Fair Trade requires buyers to pay a stable minimum price and a social premium to producer organizations, and it provides an opportunity for pre-financing and long-term contracts. With regards to the environment, Fair Trade stipulates minimised and safe use of agrochemicals, proper and safe management of waste, maintenance of soil fertility and 4  A version of this chapter will be submitted for publication. Elder S.D., Zerriffi, H., & Le Billon, P. (2010) Effects of Fair Trade certification on social capital: The case of Rwandan coffee producers 5 This study focuses on the impact of Fair Trade certified products which carry the Fairtrade Labeling Organization (FLO) FAIRTRADE Mark, rather than the impact of the broader social movement termed fair trade. 38  water resources, and prohibits use of genetically modified organisms. Only democratically organized small-scale producer groups can get Fair Trade certification; these organizations must be set up in a transparent way and must not discriminate against any particular member or social group (Fairtrade Labelling Organization (FLO), 2010). The total world market for Fair Trade certified products is valued at US$ 3.8 billion (Fairtrade Labelling Organization (FLO), 2010). Through this represents a minor share of global trade, the Fair Trade market is growing rapidly; sales increased an average of 40% per year in the last five years (FLO, 2010). There are almost 800 Fair Trade certified producer organizations in Latin America, Africa, and Asia selling certified products across North America and Europe (FLO, 2010). The FLO now certifies eighteen products, including bananas, tea, sugar, cocoa, honey, and cut flowers, with coffee remaining the most traded commodity (Jaffee, 2007). Fair Trade certification directly impacts an estimated five million people – one million certified producers and their dependents (FLO, 2010). In this context, it is important to examine Fair Trade’s impact on farmers and their families in order to understand product certification’s effectiveness as a market-based tool for improving the well-being of populations through its impacts on social capital. Research on the outcomes of Fair Trade for producers has focused on questions related to the economics of Fair Trade. Many studies address whether producers are getting higher prices for their products (Bacon, 2005; Imhof & Lee, 2007; Levi & Linton, 2003; Lyon, 2007; Murray et al., 2006; Sick, 2008), but few assess the social impacts of Fair Trade in any great depth, despite indications that the nonmonetary effects of Fair Trade are at least as important for producer well-being as the economic benefits (Nelson & Pound, 2009). Those studies that do address social impacts do not separate the effects of Fair Trade certification itself from those associated with prior social organization resulting in the adoption of certification (Elder, 2010). This article presents a case study of Rwandan coffee producers to improve understanding of the effects of cooperative organization and Fair Trade certification on producer-level social capital. The study compares farmers selling coffee to Fair Trade certified cooperatives, farmers selling to non-certified cooperatives, and farmers selling to a private entrepreneur in order to distinguish the effects of cooperative producer organization on social capital from the effects of Fair Trade  39  certification on social capital. The following section reviews the evidence of Fair Trade certification’s effects on the social capital of producers. The third section provides details of the methodology used in the study. A fourth section presents the study results, which are discussed in a subsequent section. The final section summarizes the study conclusions. 3.2  FAIR TRADE AND SOCIAL CAPITAL  Several studies claim that Fair Trade certification facilitates the building of social capital, or social networks, which can result in collective action and civic engagement (Lyon, 2007; Mendez, 2002). Shared work and regular meetings of cooperative members help create a cooperative ethos (Pirotte, Pleyers, & Poncelet, 2006) and a sense of identity and community (Moberg, 2005). Pirotte et al. (2006) maintain that the sense of solidarity generated within the producer organizations is probably the most important impact of Fair Trade certification. Fair Trade’s non-discrimination standard may contribute to solidarity by improving gender relations and racial or ethnic equality. Gender inequality still prevails in Fair Trade certified coffeefarming communities in Nicaragua, but the majority of study participants reported an increase in men’s share of domestic housework and a decrease in the number of cases of violence against women in the community (Utting, 2009). Cooperative trainings and cooperative meetings and workshops also appear to empower women producers; the position of women is changing as they build self-confidence and management capabilities (Utting-Chamorro, 2005). Interviewees reported to Utting (2009) that their cooperative’s gender focus has been successful in providing women with the necessary knowledge and skills to produce their own “Las Hermanas” (women’s) high-quality coffee, and women have moved from a situation of not having any involvement in coffee production to having more input in generating household income. Overall, evidence supports Paul’s (2005) claim that Fair Trade’s attention to gender issues has important effects, though it may not achieve a situation where women are considered on an equal basis with their male counterparts (Ronchi, 2002). The effects of Fair Trade certification on ethnic equality have not been addressed directly in the literature. However, research on coffee cooperatives and reconciliation among ethnic groups following the 1994 genocide in Rwanda provides some insight into the effects of cooperatives on member relations; membership in a coffee cooperative, and “frequent, deep, and pleasant contact” with members from the other  40  ethnic group correlated with positive attitudes toward reconciliation (Boudreaux & Tobias, 2009). In some cases, solidarity extends past cooperative members to encompass the general manager of the organization and buyers (Utting, 2009). A Nicaraguan cooperative helped its member communities obtain funding from international agencies or buyers to supplement the Fair Trade premium for development projects (Utting, 2009). Individual producers can more easily access other opportunities, such as relief funds in the case of a natural disaster, when they are organized into a cooperative and have global links from Fair Trade (Murray et al., 2003). Fair Trade can increase cooperatives’ links with global coffee buyers, leading to benefits from name recognition in consuming countries, long-term relationships with partners, and access to market information (Kilian, Pratt, Jones, & Villalobos, 2004; Murray et al., 2003; Parrish et al., 2005). Private initiatives appear to do less to assist in making such connections (Parrish et al., 2005). Commitment to Fair Trade standards may promote broad producer participation in the cooperative and the community (Raynolds et al., 2004). Bassett’s study (2009) of Fair Trade certified cotton growers in West Africa found that while women are generally excluded from conventional cotton growing, Fair Trade certified cotton-growing organizations took measures to ensure equal membership of women, improving women’s access to cash cropping opportunities (Bassett, 2009). Bacon (2005) measured participation and decision-making within Fair Trade cooperatives and found that coffee-growing households exploit relationships at multiple levels – the household, family network, and cooperative organization – to cope with crisis. This represents an empowering approach to reducing vulnerability promoted by Fair Trade’s certification standards (Utting, 2009). Raynolds et al. (2004) argue that Fair Trade’s most positive impacts come from the role it plays in individual and collective empowerment. Taylor (2005) cites producer empowerment and consequent increases in civic participation as an effect of Fair Trade certification, although there are difficulties in attributing these to Fair Trade per se, because cooperative organization has been shown to promote the development of social capital, empowerment, and democratization (Milford, 2004). Membership in a Fair Trade cooperative can, however, be a unique opportunity to be part of a nonpartisan democratic community organization (Moberg, 2005). For example, cooperative members vote to retain income to be  41  used on business development (organic conversion, technical training for quality improvements, etc.) (Renard, 2005). The participation of members of a cooperative in Nicaragua, both at the cooperative level and in their community, increased once the organization became Fair Trade certified; producers became more active in development, health and peace committees, in school committees, and had increased interactions with local and international non-governmental organizations operating locally (Utting, 2009). The evidence regarding Fair Trade’s effect on social capital indicates generally positive effects of Fair Trade certification on farmers. However, there are three potential issues with drawing such a conclusion. First, the effect may be the result primarily of participation in a cooperative organization and not Fair Trade certification per se. Second, most studies implicitly assume that cooperative organization follows Fair Trade certification when, in fact, the cooperative normally predates the certification. Third, in determining overall effects of Fair Trade certification, most studies do not account for the quality of the coffee and its impacts on outcomes (e.g. income). Each of these issues is examined in turn. A majority of the research on Fair Trade impacts does not distinguish between the effects of certification versus the effects of cooperative organization on producers, making it difficult to know whether many of the benefits to producers are the result of certification or social organization. Several studies account for differences in producer experience with Fair Trade, for example, by selecting certified cooperatives representative of geography, size and number of years certified (Murray et al., 2003; Ronchi, 2002). More generally they involve qualitative interviews and focus groups with Fair Trade certified cooperative members and leaders, and various key informants from purchasing and retailing companies, consumers of Fair Trade products, and non-governmental organizations (Calo & Wise, 2005; Dolan, 2010; Lyon, 2007; Milford, 2004; Moberg, 2005; Raynolds, 2009; Ronchi, 2002; Utting, 2009; Utting-Chamorro, 2005). Table 3.1 summarizes the evidence for Fair Trade certification’s effects on social capital, and hypothesizes that cooperative producer organization is in fact responsible for many of the effects on social capital, and that simply processing coffee at washing stations instead of at home also benefits social capital. It shows the difficulty in knowing what type of producer organization  42  is responsible for effects on social capital when few studies hold Fair Trade certification up to a benchmark other than itself.  43  Table 3.1: Effects on social capital of three types of coffee farmer organization Fair Trade certified cooperative CWS  Non-certified cooperative CWS  Privately-owned CWS  Democratic producer organization facilitates building of social networks and trust in community and cooperative board members (Moberg, 2005; Pirotte et al., 2006; Utting, 2009)  Democratic producer organization facilitates building of social networks and trust in both community and cooperative board members (Milford, 2004; Boudreaux, 2010)  CWS facilitates building of social networks by increasing interaction between producers at central processing location; may improve trust in community but not trust in CWS manager (Boudreaux, 2010)  Fair Trade organizations and democratic producer organization facilitate links to foreign buyers and organizations (Kilian et al., 2004; Murray et al., 2003; Parrish et al., 2005; Utting, 2009)  Organization of producers and quantity/quality of coffee make it easier to link farmers to foreign buyers and organizations (Boudreaux, 2010)  CWS economies of scale make it easier to link farmers to foreign buyers but not organizations (author’s hypothesis)  Producer organization facilitates collective action (Lyon, 2007; Mendez, 2002; Pirotte et al., 2006)  Cooperative organization facilitates collective action (Milford, 2004)  CWS facilitates collective action by increasing interaction between producers at central processing location (author’s hypothesis)  Producer organization facilitates civic participation (Bacon, 2005; Moberg, 2005; Raynolds et al., 2004; Renard, 2005; Taylor, 2005; Utting, 2009)  Cooperative organization facilitates civic participation (Milford, 2004)  No change in civic participation because CWS does not provide mechanism for participation (author’s hypothesis)  Democratic producer organization and nondiscrimination standard improve position of women (Bassett, 2009; Ronchi, 2002; Utting, 2009; Utting-Chamorro, 2005)  Democratic producer organization improves gender equality (author’s hypothesis)  No improvement in gender equality (author’s hypothesis)  Democratic producer organization and nondiscrimination standard improve ethnic equality (author’s hypothesis)  Democratic producer organization improves ethnic equality (Boudreaux & Tobias, 2009)  CWS improves ethnic relations by increasing interaction between producers at central processing location (Boudreaux & Tobias, 2009)  Studies of Fair Trade seem to assume that because membership in a democratic organization of small producers is a requirement for Fair Trade certification, certification is the cause of the organization. Instead, organizations generally seek Fair Trade certification because their members wish it. Cooperatives are a means for farmers to advance their interests in the Fair Trade arena and elsewhere; the cooperatives provide access to resources and opportunities that would otherwise be unattainable for their members, including but not limited to those associated with the Fair Trade market. Cooperatives are necessary intermediaries between producers and  44  international markets (Zelmer, 2006), and the key to understanding the influence of Fair Trade certification on the health outcomes of producers. Several researchers have studied Fair Trade cooperative members versus non-cooperatively organized farmers, but few have compared Fair Trade certified cooperative members to non-Fair Trade certified cooperative members. For example, Jaffee (2007) compared a small number of Mexican coffee farmers who sell to Fair Trade certified cooperatives with unorganized farmers who sell to local intermediaries. The two types of farmers surveyed by Arnould et al. (2009) included farmers who were members of Fair Trade cooperatives selling at least 30 percent of their production to Fair Trade for at least three years, and independent coffee farmers, but who were not necessarily affiliated with a cooperative. Bassett (2009) interviewed groups of Fair Trade certified and conventional cotton growers in West Africa, but it is unclear whether the conventional farmers were organized in cooperatives. In his study of Nicaraguan coffee producers, Bacon (2005) surveyed 180 members of certified coffee cooperatives, and 48 non-certified cooperative members, but does not distinguish between Fair Trade, organic, and bird friendly certification. Only one study was found that compares members of Fair Trade certified cooperatives with members of non-certified cooperatives. Parrish et al. (2005) interviewed over 100 producers, as well as key informants, from both Fair Trade certified and non-certified cooperatives supported by the NGO Technoserve, but because a benchmark population is not included in the study, it is difficult to distinguish the benefits of cooperative organization from the benefits of selling a high quality coffee. This is a common limitation of the several studies of Fair Trade that do compare Fair Trade certified producers to non-certified growers; they do not account for differences in product quality. In the case of coffee, quality matters because superior quality coffee fetches a price premium on the conventional market, but does not necessarily add a premium to the Fair Trade price (Fend, 2005). Imhof and Lee (2007) compare two Fair Trade certified cooperatives with two private companies, one selling organic coffee, and one selling to the conventional market, and Arnould et al. (2009) designed their survey methodology as a controlled comparison of Transfair USA cooperative participants and non-Fair Trade certified farmers in three countries. Neither study is clear on whether the Fair Trade product is equivalent to the conventional product in all ways apart from being certified.  45  3.3  METHODS  This study addresses the shortcomings in research design discussed above to differentiate the effects of certification from the effects of social organization on the social capital of producers. It compares Fair Trade certified cooperative members to non-certified cooperative members, includes a benchmark group of independent farmers, and accounts for coffee quality by ensuring that the coffee produced by each group is equivalent in all ways other than certification. The research takes a mixed methods approach; semi-structured interviews with farmers informed the design of a quantitative survey and the interpretation of its results. This enabled the identification not only of the frequency of perceptions, but of the thought processes that exist behind the perceptions (Morgan et al., 2002). Open-ended interviews with industry stakeholders provided additional richness and detail to the study. Triangulation of different methods increased the chances of controlling some of the multiple causes influencing results (Greene, Caracelli, & Graham, 1989). 3.3.1 Study area Despite the growing number of Fair Trade certified producer organizations in Africa, most case studies of Fair Trade’s impact are from Latin America and the Caribbean, and the impact of Fair Trade in Africa has received little attention. This study focuses on Rwanda as a country in Africa that has experience with Fair Trade certification, and in which changes in coffee production affecting social capital may have far-reaching consequences for its population. Rwanda has one of the largest numbers of Fair Trade certified coffee producer organizations in Africa (FLOCERT, 2010), and is highly dependent on export revenue from coffee. In 2009, coffee exports accounted for 36 percent of Rwanda’s total export revenue (Boudreaux, 2010). Rwanda is also an interesting case study because of its focus on production of specialty coffee which allows for a comparison of Fair Trade certified cooperative, non-certified cooperative, and independent farmers all producing a similar quality coffee. In 2007, specialty coffee accounted for 20 percent of total coffee production in Rwanda (Ministry of Agriculture and Animal Husbandry & Ministry of Trade and Industry, 2008). There is no one definition of specialty  46  coffee, but generally specialty coffees are characterized by unique flavour, origin, high quality, or certification, and their purchase is negotiated by import and export operators directly with coffee producers or producer organizations (Berndt, 2007). As a result, specialty coffee sells for a higher and generally more stable price than low quality, ‘ordinary’ grade coffee. Ordinary coffee is undistinguishable, and is traded as a commodity on the New York Board of Trade “C” market, mainly for pre-ground canned coffee and blending (Berndt, 2007). In Rwanda, small scale farmers produce ordinary coffee by manually de-pulping hand-picked coffee cherries then laying the coffee parchment in the sun to dry. To produce specialty coffee, coffee cherries are transported to coffee washing stations (CWS) immediately after picking, and the bad cherries are separated from the good cherries by immersion in a tank of water. Bad or unripe cherries float, and good cherries sink. Pulp is removed from the good cherries by pressing the fruit, and then allowing it to ferment in water for a specific period of time. When the fermentation is complete, the coffee is thoroughly washed with clean water, and then sun dried to a water content that is stable for storage (Wintgens, 2009). Coffee washing stations only buy high quality coffee cherries; normally a farmer will sell his/her high quality cherries to a coffee washing station, and process the rest of his/her cherries at home and sell them as coffee parchment to a local trader (as depicted in Figure 3.1).  47  Figure 3.1: Rwandan coffee chain from crop to cup Coffee washing stations in Rwanda are either privately owned by entrepreneurs or owned by producer cooperatives. Private owners of washing stations buy coffee cherries from independent farmers who did not invest in the processing equipment (Murekezi & Loveridge, 2009). Other producers join together in cooperatives to pool their resources to build a coffee washing station. These cooperatively-owned washing stations buy cherries from the farmers who are also part-  48  owners of the station (Boudreaux, 2010). Twenty percent of Rwanda’s 400,000 coffee growers belong to one of the nation’s 148 coffee producer cooperatives; five percent of the country’s coffee farmers belong to a cooperative with Fair Trade certification (OCIR Cafe, 2009). 3.3.2 Sampling method The study sample included Fair Trade certified cooperative producers, non-certified cooperative producers, and independent producers who produce coffee that is the same in terms of origin, quality and processing method. Fair Trade certified cooperatives were sampled purposively for longest length of experience with fair trade certification, which in Rwanda is between three and five years. Two non-certified coffee cooperatives and a privately-owned coffee washing station were selected to be in geographically similar locations to the Fair Trade cooperatives, and for their accessibility (see Figure 3.2 for study site locations). The selected cooperatives vary in size from approximately 300 members to 4500 members, the Fair Trade organizations having higher memberships than the non-certified cooperatives. The total number of farmers the privatelyowned coffee washing station buys from is unknown. Since rural Rwandan households do not have addresses, using organizations’ membership lists as a sampling frame was logistically very difficult. Instead, a snowball sampling method was used. A household near to each sampled cooperative or private coffee washing station with coffee trees growing visibly was selected. Then, to account for potential differences due to farmer proximity to the coffee washing station, each respondent was requested to refer the interviewer to a coffee grower in a different umudugudu (neighbourhood).  49  Figure 3.2:: Location of sample sites in Rwanda The three types of farmers surveyed are generally comparable. They are all small scale producers, tending between 160 and 260 coffee trees, usually on less than 1 hectare of land (OCIR Cafe, 2009); there here are no large large-scale coffee plantations in Rwanda (International (Int Fund for Agricultural Development (IFAD), 2005) 2005).. Years of highly centralized government and the small geographic size of Rwanda mean that there is not much variation in government services throughout Rwanda.. Farmers are also likely to have been recipients of the same nongovernmental organization projects projects, since these are normally administered in partnership with the government (Ministry of Finance and Economic Planning, 2006) 2006). By selecting groups that are generally comparable, the study design eeliminates as many alternative explanations expla for the effects on social capital as practically possible. 3.3.3 Data Data on social capital, socioeconomics, and Fair Trade certification were collected through semisemi structured interviews and a survey of Rwandan coffee growers over a period of two months in  50  2009. Additional data on Fair Trade certification, coffee cooperatives, and coffee production was gathered through open-ended interviews with coffee industry stakeholders in Rwanda. Semi-structured interviews carried out during an initial field visit with three to four producers from each cooperative and the private coffee washing station provided qualitative data regarding local definitions of well-being, the process of coffee production, and the overall context of producer organizations in Rwanda. This data was used to develop a context-appropriate questionnaire, which was then pre-tested, revised, translated from English into Kinyarwanda and subsequently back-translated into English to ensure the Kinyarwanda translation captured the intended meaning of the questions. Social capital measures consistent with the structural/cognitive definition of social capital were adapted from the World Bank’s Social Capital Integrated Questionnaire (World Bank, 2010), and as in similar studies, the focus of this study is on household-level measures of social capital (Mitchell & Bossert, 2007). The cognitive dimension of social capital was measured through two variables addressing trust. An open-ended question later coded as a binary yes/no response measured whether the respondent perceived an increase in trust at a general community level since he/she joined the cooperative or started selling to the CWS, and a yes/no question asked whether the respondent trusted his or her cooperative/coffee washing station leadership. In the case of cooperative members, leader refers to the cooperative board, while for independent farmers selling to a privately-owned coffee washing station, leader refers to the management, since the cooperative board and private management have the same function. The structural dimension of social capital was measured through questions relating to respondents’ perception of farmer participation in their producer organization. A binary yes/no question asked producers whether they perceived an increase in participation of the average farmer in the producer organization since they joined the cooperative or started selling to the CWS, and a second yes/no question asked producers whether they perceived an increase in participation of women farmers in the producer organization since they joined the cooperative or started selling to the CWS. Increased participation in the producer organizations was considered to represent increased social capital. The survey collected sociodemographic data on each respondent, including age, gender, income, housing characteristics, and education level. It also collected information on coffee production and producer perspectives of the definition, benefits and limitations of Fair Trade certification.  51  Additional interviews were conducted with 12 representatives of non-governmental organizations, industry, and government agencies involved in the Rwandan coffee sector. These interviews helped to shape an understanding of the coffee sector in Rwanda in its entirety, and contextualize the responses received from the farmer interviews and questionnaires. 3.4  RESULTS  3.4.1 Descriptive statistics Table 3.2 presents descriptive statistics of the study sample. Producers are comparable in terms of age and household size. While the proportion of women differs among the groups, the proportion of women sampled overall (35 percent) corresponds to the proportion of women coffee growers in Rwanda as a whole. Fair Trade certified cooperatives are less educated than other farmer groups in general, but have a slightly higher proportion of farmers with secondary school education or above. Farmers have been members of cooperatives with and without Fair Trade certification for a similar length of time (approximately six years), but farmers selling to the private entrepreneur have only been doing so for an average of two years. Annual income from coffee sales for all farmers averages 83,820 Rwandan Francs (RWF); contrary to much of the research on Fair Trade, Fair Trade certified producers sampled in this study have lower income from coffee sales on average than non-certified cooperative and private coffee farmers. However, the variance in coffee incomes is much greater for both certified and non-certified cooperatives than for the private CWS, despite the fact that the private CWS has a much greater variance in number of trees per farmer than cooperatives. Farmers had no trouble reporting their income from coffee as it comes only once per year, but had a harder time estimating their yearly income from other activities (e.g. selling food crops) that occur more frequently throughout the year. Producers who belong to a cooperative, whether Fair Trade certified or not, appear to earn higher incomes on average from other activities than do independent producers. There is also much greater variance in their incomes from other activities than for independent producers.  52  Table 3.2: Descriptive statistics Mean  FT cooperative (N=100)  Cooperative (N=47)  Private CWS (N=25)  Entire sample  43  41  41  42.5  37%  24%  48%  35%  5.8  6.4  6  6.0  No formal education  28%  19%  16%  23%  Primary education  59%  70%  76%  65%  Secondary school education or above  13%  11%  8%  12%  Years member of cooperative/selling to CWS  6.0  5.8  2.1  5.4  Number of coffee trees per household  541  642  1,165  659  Income from coffee (RWF/household)  77,322  93,562  93,574  83,820  Other income (RWF/household)  86,166  88,457  80,789  85,982  Variable Age Female Household size  As outlined above, the questionnaire measured four indicators of social capital, which act as dependent variables for the study analysis: producer perception of an increase in trust amongst community members since joining the cooperative or selling to the private CWS; producer trust in his/her cooperative board or private CWS management; producer perception of an increase in participation of farmers in his/her cooperative or CWS since starting to sell to it, and; producer perception of an increase in women farmers in his/her cooperative or CWS since starting to sell to it. Table 3.3 presents summary statistics of the social capital indicators measured in the survey. Overall, farmers perceive an increase in trust in their community members since joining their cooperatives or selling to the CWS. Nearly all farmers selling to the private coffee washing station appear to trust their coffee washing station owner, and a high percentage of non-certified cooperative members trust the board members of their cooperatives. A much lower proportion of Fair Trade certified cooperative members trust their board members. Whereas Fair Trade certified cooperative members appear to trust less, nearly half of them feel that the average member has increased participation in their cooperative. Non-certified cooperative members also appear to feel that the average member has increased participation in their cooperative; only eight percent of private farmers feel that there is increased participation in their group. Half of the private farmers do perceive greater involvement of women in their group. The non-certified cooperative members feel women have increased participation in the cooperative to a similar  53  extent that they believe all members participate more. The highest proportion (67 percent) of farmers that perceive increased participation of women in their group belongs to the Fair Trade certified cooperatives. Table 3.3: Social capital summary statistics Mean  FT cooperative (N=100)  Cooperative (N=47)  Private CWS (N=25)  Entire sample (N=172)  Trust community members  80%  85%  88%  83%  Trust leaders  61%  87%  96%  73%  Group participation – men and women  48%  33%  8%  38%  Group participation – women only  67%  27%  50%  54%  Variable  3.4.2 Regression analyses Logistic regressions are used to estimate relationships between the different forms of producer social organization and dimensions of social capital. The logit model is: P=1/(1+e-Y)  (1)  where P is the probability that a respondent perceives increased social capital, measured by the four binary dependent variables (perceived increased in trust in community, trust in leaders, perceived group participation, and perceived group participation of women), e is a constant, and Y is the log odds of the dependent variable, given by Y=ln(P/1-P) and assumed to be linearly related to the independent variables (Kutner, Nachtsheim, Neter, & Li, 2005). Two models are specified for each dependent variable. The first model (Model a) includes all observations and the explanatory variable ‘coop’ specifying whether the producer is a member of a cooperative or not: Y= 0+ 1age+ 2gender+ 3hh+ 4married+ 5edu_d1+ 6edu_d2+ 7years+ 8income+ 9workload+ 10training+ 11interact+ 12coop  (2)  54  The second model (Model b) includes only observations for cooperative members and the explanatory variable ‘ft’ specifying whether the producer’s cooperative is Fair Trade certified or not: Y= 0+ 1age+ 2gender+ 3hh+ 4married+ 5edu_d1+ 6edu_d2+ 7years+ 8income+ 9workload+ 10training+ 11interact+ 12ft  where 2,  0  is the intercept, the value of Y when the value of all independent variables is 0, and  (3) 1,  etc. indicate the weight of each independent variable’s influence on the dependent variable Y.  The coefficients estimated by the models are expressed as odds ratios, given by e . The odds ratio expresses the likelihood of change in the independent variable given a one unit increase in the dependent variable (Kutner et al., 2005). Age is age of the respondent, gender is sex of the respondent, household size refers to the number of people living in the respondent’s household, married is whether the respondent is married or not, edu_d1 and edu_d2 are dummy variables and refer to primary education or secondary education and above respectively, years is the number of years the respondent has been a member of the cooperative or selling to the private coffee washing station, income is income from coffee sales at the 2009 harvest, workload refers to the amount of work it takes to produce one kilogram of coffee cherries, training is whether the respondent has received training from his/her coffee washing station or cooperative, and interact is the respondent’s perception of an increase in the amount of interaction with community members. The coop variable specifies whether the respondent is a member of a cooperative or not, and ft refers to whether the producer’s cooperative is Fair Trade certified or not. Table 3.4 provides a brief description of all the variables used for estimation.  55  Table 3.4: Sample statistics for logit regression Variable Dependent trust_community  Description  Obs  Mean  Std. Dev.  Min  Max  Trust in community members, 1=trust, 0=no trust  158  .8291139  .3776062  0  1  trust_leaders  Trust in coffee leaders, 1=trust, 0=no trust  172  .8291139  .4439171  0  1  participation  Group participation, 1=increased participation, 0=no increase  166  .3795181  .4867353  0  1  participation_w  Group participation of women, 1=increased participation, 0=no increase  167  .5389222  .499982  0  1  Age of respondent (years)  172  42.51163  10.55506  18  81  gender  Gender of respondent, 1=female, 0=male  167  .3532934  .4794304  0  1  hh  Household size  169  6.023669  2.165621  1  12  married  Married, 1=married, 0=not married  173  .8092486  .394034  0  1  edu_d1  Primary education, Dummy, 1=primary education, 0=no education  172  .6453488  .4798043  0  1  edu_d2  Secondary education and above, Dummy, 1=secondary education and above, 0=no education  172  .1162791  .3214952  0  1  years  Years selling to current CWS  168  5.357143  3.608516  1  29  income  Income from coffee sales at last harvest (RWF)  160  83820.12  106703.3  0  800000  workload  Work to produce coffee, 1=decreased, 0=no decrease  173  .8554913  .3526254  0  1  training  Respondent received training from CWS, 1=training, 0=no training  171  .619883  .4868409  0  1  interact  Interaction with community members, 1=increased, 0=no increase  170  .3882353  .4887883  0  1  coop  Cooperative member, 1=yes, 0=no  173  .8554913  .3526254  0  1  ft  Fair Trade certification, 1=yes, 0=no  173  .583815  .4943558  0  1  Independent age  Age is included in the model as it can have generational effects on trust and civic engagement (Putnam, 1995). Gender is included to factor out effects of gender discrimination on social capital. Successful marriage has been statistically associated with higher social capital in North America (Putnam, 1995), so whether a respondent is married or not is included in this model to examine its effects. Household size is included because family networks affect social capital  56  (Putnam, 1995). Education has been found to have a powerful effect on trust and participation, thus it is included in the model (Verba et al., 1995). Whether a producer has received training from a cooperative or coffee washing station is included as it is hypothesized to have a similar effect as formal education. Length of time a respondent has been a member of their group is expected to correlate with greater group participation. Often policy focuses on increasing incomes of the rural poor, so income is included to assess whether it affects social capital. Although Robinson (1990) found that time pressure is not associated with social capital, whether the amount of work it takes a respondent to produce coffee has decreased since joining their group is included in the model because farmer interviews suggested that increased group participation is partly explained by more time due to a reduced workload. It is also expected that frequency of a respondent’s interaction with his or her neighbours, regardless of whether they belong to the same group as the respondent, affects social capital. Table 3.5 presents the results of regression Models 1a and 1b estimating explanatory factors for producers’ perception of an increase in trust in their community members. Table 3.6 gives the regression output for Models 2a and 2b estimating producers’ trust in their coffee organization leaders. Neither being a member of a cooperative nor having Fair Trade certification is significant in explaining variation in trust in community members. Instead, increased interaction with neighbours is the variable the most strongly associated with trust in community members. Age and an education level of secondary school or above also positively affect coffee growers’ trust in their community members. Whereas cooperative organization and Fair Trade have no effect on trust in community members, they have a significant negative effect on trust in leaders. Being a member of a cooperative is associated with a lack of trust in leaders, and Fair Trade certification is even more strongly associated with farmers not trusting their leaders. Although, if a farmer has received training from the cooperative or coffee washing station, he/she is more likely to trust the cooperative board members or coffee washing station owner. Also, if a farmer has experienced a decrease in the amount of work it takes to produce coffee, he/she is more likely to trust the leadership. Like trust in community, age is positively associated with trust in leaders, but interaction with neighbours does not affect trust in leaders significantly.  57  Table 3.5: Estimation output of perceived increase in trust in community members Dependent variable: Perceived increase in trust in community members Method: Logit regression Variable  Model 1a  Model 1b  age  1.0613**  1.0834**  gender  1.5731  1.9014  hh  1.2331  1.2771  married  0.7259  0.6814  edu_d1  2.2428  3.7664*  edu_d2  7.1069*  14.8572**  years  0.9948  0.9408  income  1  1  workload  1.5666  2.6035  training  1.3202  1.5015  interact  6.5271***  16.55***  coop  0.4158  ft  0.3569 N = 131  N = 108  Prob > chi2 = 0.0724  Prob > chi2 = 0.0089  Pseudo R = 0.1621  Pseudo R = 0.2569  Note: * is significant at 10% level, ** at 5%, and *** at 1%.  58  Table 3.6: Estimation output of trust in leaders Dependent variable: Trust in leaders Method: Logit regression Variable  Model 2a  Model 2b  age  1.0563**  1.0942***  gender  1.4847  1.7031  hh  1.0074  0.9433  married  1.4627  1.2067  edu_d1  1.1424  1.2280  edu_d2  1.6671  1.7352  years  0.8993  0.8994  income  1  1  workload  2.9015*  5.5567**  training  2.3360*  1.5882  interact  1.5790  1.6503  coop  0.0790**  ft  0.1456*** N = 142  N = 118  Prob > chi2 = 0.0177  Prob > chi2 = 0.0048  Pseudo R = 0.1500  Pseudo R = 0.1936  Note: * is significant at 10% level, ** at 5%, and *** at 1%.  Table 3.7 presents regression results of Models 3a and 3b examining factors associated with producer perception of group participation. Table 3.8 presents results of the regression Models 4a and 4b looking at factors related to producer perception of group participation of women. Cooperative membership is significantly associated with farmers perceiving that they participate in their cooperative; whether the cooperative is Fair Trade certified or not is not significant. Membership in a cooperative versus selling to a private coffee washing station does not affect likelihood of believing women have increased group participation, but Fair Trade certification is strongly linked to farmer perception that women participate more. Interaction with neighbours is more significant in explaining perception of increased participation of farmers than cooperative organization. Farmers are 12 to 13 times more likely to perceive that group participation of farmers has increased if they have increased interaction with their neighbours. If a farmer has increased interaction with neighbours, he/she is also 5 to 6 times more likely to feel that women  59  are participating more in the group. Being married has a strong negative effect on whether farmers feel they have increased participation in their group. If a farmer has some education (primary school), he/she is more likely to feel that he/she has increased participation in the group. The different models and their findings are summarized in Table 3.9. Table 3.7: Estimation output of perceived increase in group participation Dependent variable: Perceived increase in group participation Method: Logit regression Variable  Model 3a  Model 3b  age  1.0219  1.0312  gender  1.2243  1.0502  hh  0.9709  0.9452  married  0.2987*  0.2261**  edu_d1  3.5478*  4.0332*  edu_d2  2.8780  3.5733  years  1.0570  1.0540  income  1  1  workload  2.9405  3.3298  training  0.6495  0.4356  interact  12.6914***  13.8973***  coop  7.9640**  ft  1.3261 N = 136  N = 113  Prob > chi2 = 0.0000  Prob > chi2 = 0.0000  Pseudo R = 0.3045  Pseudo R = 0.2865  Note: * is significant at 10% level, ** at 5%, and *** at 1%.  60  Table 3.8: Estimation output of perceived increase in group participation of women Dependent variable: Perceived increase in group participation of women Method: Logit regression Variable  Model 4a  Model 4b  age  1.0096  1.0156  gender  0.8150  0.5414  hh  0.9035  0.9219  married  0.4494  0.4117  edu_d1  2.0681  1.8574  edu_d2  1.4392  2.3451  years  1.1032  1.0581  income  1  1  workload  1.5437  1.8565  training  0.8137  0.7916  interact  5.6195***  6.8499  coop  0.5975  ft  3.8236*** N = 138  N = 116  Prob > chi2 = 0.0102  Prob > chi2 = 0.0004  Pseudo R = 0.1384  Pseudo R = 0.2228  Note: * is significant at 10% level, ** at 5%, and *** at 1%.  61  Table 3.9: Summary of regression models and their findings Model #  Dependent variable  Comparison  Summary of findings  Model 1a  Perceived increase in trust in community members  Coop vs. Non-coop  Age, education, interaction all significant. Interaction the key variable.  Model 1b  Perceived increase in trust in community members  FT vs. Non-FT coop  Education and interaction significant and large.  Model 2a  Trust in leaders  Coop vs. Non-coop  Age, workload, training and cooperative all significant. Cooperative negative and large.  Model 2b  Trust in leaders  FT vs. Non-FT coop  Age, workload, and FT all significant. FT negative and large.  Model 3a  Perceived increase in group participation  Coop vs. Non-coop  Marriage, education, interaction and cooperative all significant. Interaction and cooperative large.  Model 3b  Perceived increase in group participation  FT vs. Non-FT coop  Marriage, education and interaction all significant. Interaction the key variable.  Model 4a  Perceived increase in group participation of women  Coop vs. Non-coop  Interaction significant and large.  Model 4b  Perceived increase in group participation of women  FT vs. Non-FT coop  Fair Trade significant and large.  3.5  DISCUSSION  The literature on Fair Trade certification’s impacts indicates that the social effects of Fair Trade certification may be especially important for producer well-being, due mainly to the cooperative organization of producers. This study aims to improve understanding of whether the effects on producer-level social capital are a result primarily of social organization or of Fair Trade certification. The regression analyses provide evidence that cooperative organization and Fair Trade certification are both associated with dimensions of social capital, although not always in the ways expected. Contrary to expectations, neither cooperative organization nor Fair Trade certification is associated with increased trust amongst community members. Even less consistent with expectations, cooperative organization, and especially Fair Trade certification, have a significant negative association with trust in cooperative board members (see explanation below). Findings regarding group participation are more consistent with the study hypotheses; cooperative membership, regardless of certification, is positively correlated with a perceived increase in participation, and Fair Trade certification is strongly associated with farmer perception that women are participating more. Interpretation of the results of this study is limited  62  to association and not causation. Just as cooperative organization and Fair Trade certification may affect social capital, the converse is likely true as well. Cooperatives may form where there is higher social capital, and non-governmental organizations may choose to assist cooperatives with higher levels of social capital to obtain Fair Trade certification. In Rwanda, trust is understood broadly as what Govier and Verwoerd define as “an attitude of confident expectation” that the person or persons trusted will act in a decent, competent, and acceptable way that does not result in harm to the trusting person (Govier & Verwoerd, 2002). Study respondents gave the following as specific examples of trust: the ability to depend on a person for help, whether in the form of advice or a loan; the knowledge that a person will not steal from you; and an understanding of the other person and their motivations. In general, coffee producers report that they trust their community members; many explain that this is due to being a member of a cooperative. One producer explained that “community support has increased a lot because we have seen the benefits of working together. We didn't know before about the benefits of joining together in a cooperative” (Producer IAA003). Another cooperative member said “before the cooperative I spent the whole day at home after work. Now I meet people through the cooperative and meet them to share a bottle of beer and ideas” (Producer IAE001). A farmer elaborated: “We are able to discuss with others, share ideas, get ideas, learn from them, and don’t feel isolated” (Producer IAC003). While the producers interviewed tend to associate trust in their community members with being a member of a cooperative, the regression results indicate that trust in community is not associated with cooperative membership or Fair Trade certification. Instead, age, education, workload, and community interaction are associated with a perceived increase in trust in community members. The older a farmer is, the higher the odds he/she trusts his or her community members. Respondent age and years living in the current location are highly correlated, suggesting that the older a farmer is, the more time he/she has spent with his or her neighbours, and thus the more he/she trusts them. Farmers with secondary school or higher education appear more likely to trust their neighbours. A possible explanation for this is that more highly educated farmers have more frequent interaction with their neighbours than less educated farmers. Overall, whether a farmer spends more time with his or her neighbours or not has the greatest effect on whether  63  he/she is more likely to trust them. This is consistent with farmer explanations for trust in their community, except that many attribute increased interaction with their neighbours to being a member of a cooperative. Interestingly, producers selling to the privately-owned coffee washing station attribute increased interaction with their neighbours to coffee: “coffee lets us know other people in the area,” and explain that the CWS “brings ideas from different people and gives you strength to stand together” (Producer IAB005). In most cases, independent producers seem to equate selling to the privately-owned CWS with being a member of a cooperative, indicating that private coffee washing stations may play a role similar to the one expected of cooperatives in the lives of coffee farmers in Rwanda. As one producer said, “in general, people in the community have good relationships because people are brought together by coffee” (Producer IAD002). It is possible that selling to a central processing location increases interaction among neighbours, regardless of whether the coffee washing station ownership is private or cooperative. Cooperative organization and Fair Trade certification do not appear linked to trust in community members, but both exhibit negative associations with trust in leaders, whereas private CWS ownership does not. This may be the result of two or three cooperatives experiencing problems with corruption. A staff member of a Rwandan coffee company explained that “whether farmers benefit from joining in cooperatives depends largely on the management of the cooperative” (Representative 1). The Director of a different coffee company in Rwanda suggests that cooperative organization can make it easier for an individual to take advantage of members because they are organized and have a leadership structure they respond to (Representative 2). This possible explanation is supported by the assertion of a staff member of an NGO supporting coffee cooperatives in Rwanda who believes that the history of colonial rule and dictatorial governments in Rwanda has led to a culture of farmers doing what they are told by authorities without question for fear of the consequences, and that this makes it easy for cooperative managers to act in their own interest instead of the interest of the group. He maintains that capacity building of cooperative members is key, more so than Fair Trade certification, so that farmers understand the concept of a cooperative and that they own and control the organization (Representative 3).  64  Despite lacking trust in their cooperative board members, being a member of a cooperative increases the odds that a farmer feels he/she has increased participation in his/her cooperative, whereas selling to a privately-owned coffee washing station is not associated with perceptions of increased group participation. A technician working with coffee cooperatives in Rwanda contends that farmers are learning and capturing the value of democracy. Having experienced a variety of leadership styles over the years, including corrupt management, cooperative members are beginning to understand that by voting for their choice of board members they can affect the organization’s impact on their lives (Representative 3). While Fair Trade certification does not appear to have an effect above and beyond cooperative membership on group participation of farmers in general, it is strongly linked to perceptions of increased group participation of women whereas cooperative organization is not. Whether a farmer is male or female has no significant effect on his/her perception that women have increased group participation. This suggests that Fair Trade’s non-discrimination standard may have a positive effect on gender relations in Rwanda. Because interaction with neighbours is also significant in explaining feelings that women participate more, it is likely that farmers are not just saying there is gender equity and that women actually do participate more when they belong to a cooperative with Fair Trade certification. A producer explained that “before women stayed at home and couldn’t go out and get ideas. Before they said the cooperative was only for men, but then said women can join and we’ll see how they can produce. Now women have their own association within the cooperative that produces the best coffee” (Producer IAF001). 3.6  CONCLUSION  The literature indicates that Fair Trade certification has a positive impact on the social capital of producers, yet most studies do not separate the effects of certification itself from those associated with prior social organization resulting in the adoption of certification. This research compared Fair Trade certified cooperative, non-certified cooperative, and independent producers of specialty coffee in Rwanda to understand the effects of Fair Trade certification on social capital of producers. The overall effect on social capital of producers is unclear. Cooperative organization is linked to a lack of trust in leaders and a perceived increase in group participation of farmers. It has no effect on producers’ trust in their community members and whether they 65  perceive an increase in the group participation of women. Fair Trade certification is negatively associated with farmer trust in cooperative leaders and positively associated with group participation of women, and appears to have no effect on producers’ trust in their community members and whether they perceive an increase in their group participation. The research suggests that increasing interaction amongst producers and their neighbours has the greatest positive effect on the social capital of producers; increased interaction amongst community members is correlated with producer perception of an increase in both trust in their community members and group participation for all farmers. Cooperative organization and Fair Trade certification appear to be relatively less important for improving social capital. The results indicate the importance not just of Fair Trade certification or non-certification, but of a farmer’s particular experience of their cooperative producer organization. Poorly managed Fair Trade organizations cannot compensate for the negative effects on social capital just by having Fair Trade certification. Government and non-governmental organizations may provide more support for producer organizations in order to help ensure members benefit from the organization. Context appears to matter for whether a cooperative organization benefits farmers, and Fair Trade and other non-governmental organizations may choose to design their standards and projects to be more context-specific in order to improve their impact. More research in different contexts would help determine the particular conditions under which Fair Trade certification can make a difference to producer well-being and inform policy. In the case of Rwanda, further research may focus on understanding what increases interaction amongst producers in Rwanda, if neither cooperative organization nor certification, as this may be what is most important for increasing social capital of producers. The impact of Fair Trade on producer networking and influence on policy should also be explored in the future, as creating networks that bridge power structures may be where Fair Trade has the greatest impact on social capital.  66  3.7  REFERENCES  Arnould, E. J., Plastina, A., & Ball, D. (2009). Does Fair Trade deliver on its core value proposition? Effects on income, educational attainment, and health in three countries. Journal of Public Policy & Marketing, 28(2), 186-201. doi:10.1509/jppm.28.2.186 Bacon, C. (2005). Confronting the coffee crisis: Can Fair Trade, organic, and specialty coffees reduce small-scale farmer vulnerability in northern Nicaragua? 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(1997). Neighborhoods and violent crime: A multilevel study of collective efficacy. Science, 277(5328), 918-924. doi:10.1126/science.277.5328.918 Schuller, T., Baron, S., & Field, J. (2000). Social capital: A review and critique. In Social capital: critical perspectives. Oxford University Press. Sick, D. (2008). Coffee, farming families, and Fair Trade in Costa Rica: New markets, same old problems? Latin American Research Review, 43(3), 193-208. DOI: 10.1353/lar.0.0042 Szreter, S., & Woolcock, M. (2004). Health by association? Social capital, social theory, and the political economy of public health. Int. J. Epidemiol., 33(4), 650-667. doi:10.1093/ije/dyh013 Taylor, P. L. (2005). In the market but not of it: Fair Trade coffee and forest stewardship council certification as market-based social change. World Development, 33(1), 129-147. doi:10.1016/j.worlddev.2004.07.007 Utting, K. (2009). Assessing the impact of Fair Trade coffee: Towards an integrative framework. 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Retrieved August 15, 2010, from http://go.worldbank.org/LHI4AYZEF0 Zelmer, M. (2006). Cooperative solutions : How the Fair Trade and organic coffee markets support forested ecosystems on Nicaraguan coffee farms (Doctoral dissertation). The University of British Columbia, Vancouver, BC.  71  4 CONCLUSION 4.1  SUMMARY  Health is strongly influenced by social conditions, and achieving healthy populations will require interventions that address the social causes of health. For small-scale producers of consumable goods, one possible avenue for ensuring that the social determinants of health are improved is through certification systems that use production standards, monitoring, certification and labelling to identify and reward items produced under exemplary social and environmental conditions. Such voluntary certification systems (e.g. organic farming labels, fair trade labels, etc.) provide both resources and guidelines for changing conditions within workplaces, households and in the overall community. This thesis examined Fair Trade certification’s effects on the social determinants of health of small-scale producers. A meta-study of the Fair Trade literature found that Fair Trade certification positively affects producer health through three main processes: improvement of material conditions (physical capital); better education (human capital); and more extended and robust social networks (social capital). The evidence suggests that Fair Trade certification may be a useful tool through which governments and organizations can promote cooperative organization and affect the social determinants of health of small-scale producers. The reviewed studies do not, however, make it clear whether the benefits to producers are the effects of certification itself or whether they are associated with prior social organization resulting in the adoption of certification. Thus the case study research presented in Chapter three of the thesis addressed the shortcomings in research design discussed in Chapter two in order to identify Fair Trade certification’s effects on social capital. The research design: (1) accounted for coffee quality by ensuring that the product was equivalent in all ways other than certification for the comparison groups; (2) compared Fair Trade certified cooperative members to non-certified cooperative members to differentiate the effects of certification from the effects of social organization; and, (3) included a benchmark group of independent farmers producing an equivalent coffee.  72  Since little research on Fair Trade has taken place in Africa, the study focused on Rwanda, an African nation that has experience with Fair Trade certification (FLO-CERT, 2010) and is highly dependent on export revenue from coffee (Boudreaux, 2010). The study measured both cognitive (producer perceptions of trust) and structural (producer perceptions of group participation) aspects of social capital. The results indicate that, in terms of the cognitive dimension, cooperative organization is negatively associated with social capital and that Fair Trade certification amplifies the negative effect. Cooperative organization is positively associated with the structural dimension of social capital, and while Fair Trade certification does not have any additional effect on the structural social capital of farmers in general, it does associate strongly with the perception that women have increased structural social capital. The results suggest that, as hypothesized, cooperative organization affects the social capital of producers, and that Fair Trade certification can amplify its effects. Contrary to expectations, these effects on social capital are not always positive. In the case of Rwanda, it may be that the government’s move to producing coffee at coffee washing stations (Ministry of Agriculture and Animal Husbandry & Ministry of Trade and Industry, 2008) is bringing coffee farmers together and they are interacting more than in the past, thus increasing their trust in each other. The negative association of cooperatives and Fair Trade certification with trust in leadership indicates that organizational conditions and country context likely play a significant role in determining the effects of Fair Trade certification. Because cooperative membership is linked with group participation of farmers, and Fair Trade certification with group participation of women, it is possible that cooperatives and Fair Trade provide a forum for participation of farmers, despite them lacking trust in their leaders. It is difficult to predict what the overall effect of cooperatives and Fair Trade certification is on producers because of their mixed effects on the different measures of social capital. 4.2  STRENGTHS AND LIMITATIONS OF THE RESEARCH  The meta-study highlighted the importance of the social impacts of Fair Trade certification for producers. The case study contributes to a better understanding of Fair Trade certification’s impacts on those it purports to help, as its findings are based on producer perspectives. Because the empirical research focuses on one country, it also furthers understanding of how Fair Trade 73  certification has an impact in different contexts, and helps to fill a gap in the literature regarding Fair Trade in Africa. The research design controls for as many causal factors as possible and selected comparison groups in a way that eliminated as many alternative explanations as practically possible. By distinguishing the effects of certification from the effects of social organization, the study provides an example of how to identify the factors that shape the impacts of Fair Trade. A limitation of the meta-study is that it only included studies published in English, and there are likely to be impact studies in other languages which were not included in the study results. The non-random sample included in the case study does not allow for determination of causal relationships. As a case study, the empirical research results may not be generalizable to other certified products or countries, and are limited to descriptions of what respondents say they do or how they feel, not necessarily what they actually do or really feel about something. 4.3  POTENTIAL APPLICATION OF THE RESEARCH FINDINGS  The research findings are relevant for researchers, producers, policy-makers, non-governmental organizations, and consumers. By identifying the limitations of prior studies on Fair Trade’s impact, the meta-study specifies how research can be improved in order to better understand the effects of certification on producers. The meta-study and the case study help producers and their organizations to make informed business choices by identifying various effects of Fair Trade certification on producers. Often, farmers lack objective information on what it means to participate in certification systems (Giovannucci & Potts, 2008). In this case, effort will be made to communicate the research results to Rwandan coffee growers through a national radio programme that broadcasts information about coffee growing and marketing techniques and the health of the coffee farming community. The study also helps government and non-governmental organizations, including Fair Trade organizations, to understand the effects of their projects supporting coffee cooperatives and/or Fair Trade certification. For example, based on study findings indicating that context influences the effects of Fair Trade certification, Fair Trade organizations may choose to make their standards and projects more context-specific. Government and non-governmental organizations may provide more support for producer cooperatives in order to help ensure members benefit from the organization. By strengthening the 74  evidence base for Fair Trade’s impacts, the research also helps ensure that public debates are based on empirical evidence rather than ideological positions and speculation. The empirical evidence helps provide a basis for consumer decision-making. 4.4  DIRECTIONS FOR FUTURE RESEARCH  Chapter three of this thesis analyses only a small portion of the dataset collected in Rwanda. The dataset will be used for future analyses, including an analysis of producer knowledge and perceptions of Fair Trade certification, and an analysis of the impact of Fair Trade certification on the material circumstances of producers. The research in this thesis takes a step toward establishing detailed empirical evidence of the impact of Fair Trade certification in a particular context; more research in various contexts (e.g. focused on a different certified product or in a different country) is required to better determine the particular conditions under which Fair Trade certification can make a difference to producer health and inform policy. For example, this study looks at the role Fair Trade plays in the lives of individual producers, but several studies note that Fair Trade also strengthens producer cooperatives (Murray et al., 2003; Ruben et al., 2008; Utting, 2009). Further research is needed to identify the effects of Fair Trade certification at the cooperative level, and how these translate into effects at the household level. The meta-study revealed that income from Fair Trade often provides a means of survival for producer organizations, for example, by paying organization debts, instead of funding community development projects. Future research could focus on fully understanding the impact of the Fair Trade premium and price at a producer level. The case study provides evidence that, at a community level, cooperative organization affects the perceived group participation of smallholders, and that Fair Trade certification affects perceptions that women are participating more. It did not assess the influence of producers and their organizations at the national and international levels. The impact of Fair Trade on producer networking and influence on policy should be explored in the future, as creating networks that bridge power structures may be where Fair Trade has the greatest impact on social capital. This study addressed the environment as one social determinant of health; there is also a need for studies that explore interactions between social and environmental aspects of Fair Trade certification and their combined influence on health. 75  4.5  REFERENCES  Boudreaux, K. (2010). A better brew for success: Economic liberalization in Rwanda's coffee sector (Working paper). Mercatus Center: George Mason University. FLO-CERT. (2010). Operators. Retrieved July 23, 2010, from http://www.flo-cert.net/flocert/main.php?id=10 Giovannucci, D., & Potts, J. (2008). Seeking Sustainability. International Institute for Sustainable Development. Retrieved from http://www.iisd.org/pdf/2008/seeking_sustainability.pdf Ministry of Agriculture and Animal Husbandry, & Ministry of Trade and Industry. (2008). Rwanda national coffee strategy 2009-2012. Retrieved from http://amis.minagri.gov.rw/sites/default/files/user/National_Coffee_Strategy_Rwanda_200 9-2012.pdf Murray, D., Raynolds, L. T., & Taylor, P. L. (2003). One cup at a time: Poverty alleviation and Fair Trade in Latin America. Retrieved from http://www.colostate.edu/depts/sociology/FairTradeResearchGroup/doc/fairtrade.pdf Ruben, R., Fort, R., & Zuniga, G. (2008). Impact assessment of Fair Trade programs for coffee and bananas in Peru, Costa Rica and Ghana. Solidaridad. Retrieved from http://www.solidaridad.nl/files/Summary%20Study%20Assignment%20by%20Solidaridad _0.pdf Utting, K. (2009). Assessing the impact of Fair Trade coffee: Towards an integrative framework. Journal of Business Ethics, 86(0), 127-149. doi:10.1007/s10551-008-9761-9  76  5 APPENDICES APPENDIX A: UBC RESEARCH ETHICS BOARD CERTIFICATE OF APPROVAL The University of British Columbia Office of Research Services Behavioural Research Ethics Board Suite 102, 6190 Agronomy Road, Vancouver, B.C. V6T 1Z3  CERTIFICATE OF APPROVAL- MINIMAL RISK RENEWAL PRINCIPAL INVESTIGATOR:  DEPARTMENT: UBC BREB NUMBER: UBC/College for Interdisciplinary Philippe Le Billon Studies/Liu Institute for Global H09-01749 Issues INSTITUTION(S) WHERE RESEARCH WILL BE CARRIED OUT: N/A  Institution  Other locations where the research will be conducted:  N/A  Site  Interviews will be conducted in rural communities of Rwanda. These are very poor areas with few facilities or community buildings as we know them. The researcher will travel by foot from house to house to administer interviews and questionnaires with an interpreter to those who are interested. The researcher will be residing in the community. CO-INVESTIGATOR(S): Hisham Zerriffi Sara D. Elder SPONSORING AGENCIES: UBC Humanities and Social Science (HSS) Research Fund PROJECT TITLE: Social and environmental impacts of Fair Trade certification on small scale producers EXPIRY DATE OF THIS APPROVAL: July 20, 2011 APPROVAL DATE: July 20, 2010  The Annual Renewal for Study have been reviewed and the procedures were found to be acceptable on ethical grounds for research involving human subjects.  Approval is issued on behalf of the Behavioural Research Ethics Board  Dr. M. Judith Lynam, Chair Dr. Ken Craig, Chair 77  Dr. Jim Rupert, Associate Chair Dr. Laurie Ford, Associate Chair Dr. Anita Ho, Associate Chair  78  APPENDIX B: SEMI-STRUCTURED INTERVIEW SCRIPT Introduction Hello, my name is Sara. I am a Canadian student conducting research for my Master’s degree. I would like to ask you some questions about your well-being and about growing coffee. There are no right or wrong answers; I am interested only in what you think personally. If you don’t know the answer to a question, that’s no problem. Consent Do you consent to be interviewed? Do you consent to have your responses voice recorded? * Sign Consent Form Questions 1. Health 1.1.To you, what is a good life? 1.2.What has a positive effect on your life? 1.3.What has a negative effect on your life? 1.4.Of the things you just mentioned that affect your life, what has the most important effect? 1.5.Does the environment affect your life? How? 1.6.Do the people in your community affect your life? How? 2. Cooperatives/CWS 2.1.Can you tell me what the advantages of being a member of a cooperative/selling to a CWS are? 2.2.Can you tell me what the disadvantages of being a member of a cooperative/selling to a CWS are? 3. Fair Trade 3.1.Have you heard of Fair Trade certification? 3.2.If yes, can you explain to me what it is? 3.3.Can you tell me what the advantages of Fair Trade certification are? 3.4.Can you tell me what the disadvantages of Fair Trade certification are? 4. Effects of cooperative/CWS 4.1.How does the cooperative/CWS affect…? __ Your household income __ The security of your finances __ Market access __ The amount of stress in your life __ Your decision to grow coffee __ Your education __ Your access to healthcare __ Your diet __ How much alcohol you drink __ Your housing  __ The water you access __ Your cooking fuel __ The environment (soil, water, air) __ The way you cultivate __ Your safety __ How you transport your coffee __ Access to other projects/NGOs/visitors __ Who makes decisions in your household __ The role of men and women __ Your relationship with your neighbours 79  __ Your participation in society __ The way people perceive you  __ Your pride in your work  4.2.What changes could be made to Fair Trade/ the cooperative/the CWS to improve its effect on your life? 4.3.What could improve your well-being more than Fair Trade/the cooperative/the CWS? 5. Demographic information Name: Title: Cooperative/CWS: Location: Sold to cooperative: Sold to traders: Land owned: Number of coffee trees: Household size: Other activities:  80  APPENDIX C: SURVEY INSTRUMENT INTRODUCTION AND CONSENT INFORMED CONSENT Hello. My name is _________________________ and I am working for Sara Elder, a Master’s student from Canada. We are conducting a survey about the lives of coffee producers in Rwanda. We would very much appreciate your participation in this survey. I would like to ask you about your life and about being a member of a coffee cooperative. This information will help Sara to understand the experience of people producing coffee for the world market. The survey usually takes between 20 and 45 minutes to complete. Whatever information you provide will be kept strictly confidential and will not be shown to other persons. The information will be used by Sara to write her thesis, and to inform decision makers of the reality of coffee producers. Participation in this survey is voluntary and you can choose not to answer any individual question or all of the questions. However, we hope that you will participate in this survey since your views are important. There are no wrong or right answers; we are interested only in what you think. Your personal opinion is what is valuable in this study. At this time, do you want to ask me anything about the survey? May I begin the survey now? Signature of interviewer: ________________________________  Date: ________________________  RESPONDENT AGREES TO BE INTERVIEWED...1 RESPONDENT DOES NOT AGREE TO BE INTERVIEWED...2 SECTION 1. RESPONDENT’S BACKGROUND NO. QUESTIONS How old are you?  END  RESPONSE AGE IN COMPLETED YEARS  IF AGE < 19 OR > 49 YEARS END THE INTERVIEW Do you grow coffee? YES NO How many years have you been growing coffee? NUMBER OF YEARS Are you a member of a coffee cooperative? IF YES: What is the name of the cooperative? Are you an ordinary member, a board member or an employee of the cooperative? How many years have you been a member of the coffee cooperative? How many coffee trees do you tend? SECTION 2. MATERIAL NO. QUESTIONS How many kilograms of coffee cherries did you sell to your cooperative last harvest (2009)? What price per kilogram of coffee cherries did you receive from your cooperative last harvest (2009)? How many kilograms of coffee cherries did you sell to any other cooperative(s) last harvest (2009)?  YES (SPECIFY) NO MEMBER BOARD EMPLOYEE NUMBER OF YEARS  SKIP  END  END  NUMBER OF TREES  RESPONSE KILOGRAMS  SKIP  RWF KILOGRAMS  IF 0 12  81  NO.  QUESTIONS What price per kilogram of coffee cherries did you receive from the other cooperative(s) last harvest (2009)? What was your reason for selling some of your coffee cherries to the other cooperative instead of your own? How many kilograms of coffee parchment did you sell to local traders last harvest (2009)? What price per kilogram of coffee parchment did you receive from local traders last harvest (2009)? If you could set a producer price per kilogram of coffee cherries that was fair, how much would it be? What was your total income from coffee sales this year (2009)? What was your total income from other activities this year? What do you spend your income on? RECORD ALL MENTIONED.  Has your household income decreased, stayed the same, or increased since you joined the cooperative? How do you use the increase in income you get from selling coffee to the cooperative? RECORD ALL MENTIONED.  Since you joined the cooperative, have you had to borrow money? IF YES: From the coffee cooperative, a bank, or an individual?  RWF  RESPONSE  HIGHER PRICE EASIER TRANSPORT OTHER (SPECIFY) KILOGRAMS RWF  SKIP  IF 0 15  RWF RWF RWF BUYING FOOD FOOD CROPS HOUSE DEBTS HEALTH CARE EDUCATION COFFEE INPUTS OTHER (SPECIFY) DECREASED SAME INCREASED BUYING FOOD FOOD CROPS HOUSE DEBTS HEALTH CARE EDUCATION COFFEE INPUTS OTHER (SPECIFY)  Why did you have to borrow money?  YES, COOPERATIVE YES, BANK YES, INDIVIDUAL NO SPECIFY  Are you able to repay all your debts plus interest when you sell your coffee?  YES NO  21 21  82  NO.  QUESTIONS Does any member of your household own: A bicycle? A motorcycle or motor scooter? A car or truck? A mobile telephone? A radio? Do you own any animals? IF YES: What?  MAIN MATERIAL OF THE FLOOR. RECORD OBSERVATION.  MAIN MATERIAL OF THE HOUSE. RECORD OBSERVATION. MAIN MATERIAL OF THE ROOF. RECORD OBSERVATION. What is the main source of drinking water for members of your household? IF MORE THAN ONE, CIRCLE ONE MOST FREQUENTED.  Has the cooperative had any impact on how long it takes you to go, collect water, and return home? Explain.  Has the cooperative had any impact on how long it takes you to gather fuel wood? Explain.  RESPONSE  SKIP  BICYCLE MOTORCYCLE CAR OR TRUCK MOBILE RADIO NO COW GOAT SHEEP RABBIT CHICKEN EARTH/SAND DUNG WOOD PLANKS PALM/BAMBOO PARQUET VINYL OR ASPHALT STRIPS CERAMIC TILES CEMENT CARPET OTHER (SPECIFY) UNCOOKED BRICKS COOKED BRICKS GRASS/LEAVES TILES SHEET METAL PIPED INTO DWELLING PIPED INTO YARD/PLOT PUBLIC TAP OPEN PUBLIC WELL PROTECTED PUBLIC WELL SPRING RIVER/STREAM POND/LAKE RAINWATER BOTTLED WATER YES NO  YES NO  83  NO.  QUESTIONS Do the food crops you grow provide almost none, less than half, more than half, or all of your household’s food for the year? What foods do you eat now that you didn’t eat before you joined the cooperative, if any? RECORD ALL MENTIONED.  Are members of your household sick less often, the same amount, or more often than they were before you joined the cooperative? Why is this?  In the last 3 months, has anyone in your household required medical treatment? IF YES: Was this person able to get treatment? Which type of medical insurance do you currently have?  Does your cooperative provide you with free medical insurance, or do you purchase it? Has the cooperative done anything to improve the health of its members? IF YES: What?  Has the amount of work it takes to produce a kilogram of coffee decreased, stayed the same or increased since you joined the cooperative?  RESPONSE NO FOOD CROPS ALMOST NONE LESS THAN HALF MORE THAN HALF ALL NONE MEAT RICE VEGETABLES FRUIT MILK/EGGS OTHER (SPECIFY)  SKIP  LESS SAME MORE MUTUAL HEALTH TRAINING IMPROVED HEALTH SERVICES IMPROVED DIET OTHER (SPECIFY) DON’T KNOW YES, NO TREATMENT YES, TREATMENT NO NONE RAMA MUTUAL GOVERNMENT MUTUAL OTHER (SPECIFY)  39  FREE PURCHASE MUTUAL HEALTH TRAINING IMPROVED HEALTH SERVICES IMPROVED DIET OTHER (SPECIFY) DON’T KNOW NO DECREASED SAME INCREASED  42 42  84  NO.  QUESTIONS Since the amount of work has decreased, what do you do with the extra time?  RESPONSE GROW FOOD CROPS CARE FOR ANIMALS INCOME ACTIVITIES HELP FRIENDS/FAMILY HELP OTHERS STUDY MEET SOCIALLY OTHER (SPECIFY)  What impact, if any, has the cooperative had on your childrens’ education?  SPECIFY  Are you able to pay for your children to attend primary school? Are you able to pay for your children to attend secondary school? Has the cooperative had any effect on how much time your children spend helping you grow coffee? IF YES: Has the amount of time decreased or increased? Before you joined the cooperative, which of the following did you do to grow coffee: Applied pesticides? Applied fertilizers? Applied manure? Used mulch? Grew trees with the coffee? Grew grass around the coffee? Currently, which of the following do you do to grow coffee: Apply pesticides? Apply fertilizers? Apply manure? Use mulch? Grow trees with the coffee? Grow grass around the coffee? Do you always use a pump when you apply pesticides?  YES NO YES NO YES, DECREASED YES, INCREASED NO  Do you always use a mask when you apply pesticides? Since you joined the cooperative, do you get less, the same, or more coffee cherries per tree? Has the cooperative done anything to improve the environment? IF YES: What?  SKIP  PESTICIDES FERTILIZERS MANURE MULCH TREES GRASS PESTICIDES FERTILIZERS MANURE MULCH TREES GRASS YES NO SOMETIMES YES NO SOMETIMES LESS SAME MORE YES NO  85  SECTION 3. PSYCHOSOCIAL NO. QUESTIONS Do you meet with people in your community less, the same, or more now than before you joined the cooperative? When you meet, what do you discuss?  When you’re sick, who helps and cares for you: family, friends, cooperative members, or no one? Since you joined the cooperative, has the amount of stress in your life decreased, stayed the same, or increased? Why has your stress decreased? RECORD ALL THAT ARE MENTIONED.  LESS SAME MORE SPECIFY  FAMILY FRIENDS COOPERATIVE MEMBERS NO ONE DECREASED SAME INCREASED LOANS INCOME SAVINGS THIEVES OTHER (SPECIFY)  Do you feel more proud today of the coffee you produce than you did before joining the cooperative? Why or why not?  YES NO  Since you joined the cooperative, do your neighbours respect you any differently?  SPECIFY  SECTION 4. POLITICAL NO. QUESTIONS Who in your household mainly decides how the money you earn will be used?  RESPONSE  RESPONSE RESPONDENT HUSBAND/PARTNER RESPONDENT AND HUSBAND/ PARTNER JOINTLY SOMEONE ELSE RESPONDENT AND SOMEONE ELSE JOINTLY  SKIP  57 57  SKIP  86  NO.  QUESTIONS Who in your household usually has the final say on the following decisions?  Your own health care? Making large household purchases? Making household purchases for daily needs? Visits to family or relatives? What food should be cooked each day? Since you joined the cooperative, is there less, the same, or more participation from women in decisionmaking of the cooperative? Since you joined the cooperative, do ordinary farmers participate less, the same, or more in decision-making of the cooperative? Has the cooperative had any impact on the level of trust between people in your community? Explain.  Do you feel you can trust the cooperative board members? Do you feel you can trust the cooperative management? Would you still grow coffee, even if there was no cooperative? Have you participated in training from the cooperative? What was the training about?  RESPONSE  RESPONDENT HUSBAND/PARTNER RESPONDENT & HUSBAND/PARTNER JOINTLY SOMEONE ELSE RESPONDENT & SOMEONE ELSE JOINTLY DECISION NOT MADE/NOT APPLICABLE  SKIP  LESS SAME MORE LESS SAME MORE YES NO  YES NO YES NO YES NO YES NO COFFEE QUALITY HEALTH ENVIRONMENT OTHER (SPECIFY)  69  What other organizations and projects are in your community because the cooperative exists?  Have you ever heard of fair trade certification? Is your cooperative fair trade certified?  YES NO YES NO DON’T KNOW  87  NO.  QUESTIONS What standards does the cooperative have to meet in order to get fair trade certification? DO NOT PROMPT. RECORD ALL MENTIONED.  What are the benefits of a cooperative having fair trade certification? DO NOT PROMPT. RECORD ALL MENTIONED.  In what ways does fair trade certification impact the health of farmers?  What are the disadvantages of a cooperative having fair trade certification? DO NOT PROMPT. RECORD ALL MENTIONED.  Does fair trade benefit the cooperative, the farmer, the general community, the government, or no one? RECORD ALL MENTIONED. What does your cooperative do with the premium it gets?  In what way, if at all, does fair trade benefit the general community?  RESPONSE QUALITY QUANTITY ENVIRONMENTAL COOP MANAGEMENT SAFETY OTHER (SPECIFY)  SKIP  DON’T KNOW NONE MARKET ACCESS PREMIUM HIGHER PRICE STABLE PRICE OTHER (SPECIFY) DON’T KNOW NONE  LOW PRICE UNREALISTIC STANDARDS INCREASED WORKLOAD OTHER (SPECIFY) DON’T KNOW NONE COOPERATIVE FARMER COMMUNITY GOVERNMENT NO ONE REWARDS SOME FARMERS REWARDS ALL FARMERS COMMUNITY PROJECT IMPROVES WASHING STATION PAYS COOP DEBTSOTHER (SPECIFY) NO PREMIUM SPECIFY  88  NO.  QUESTIONS What community projects has your cooperative completed?  Have you recommended to other people to join the cooperative? What reasons did you give them to join/not to join? LIST ALL MENTIONED.  RESPONSE SCHOOL WATER TAP GENDER VIOLENCE OTHER (SPECIFY)  SKIP  NONE YES NO  Is there anything you’d like to add about your experience with fair trade farming?  IDENTIFICATION RESPONDENT NAME: PROVINCE: DISTRICT: SECTOR: CELL: HOW LONG HAVE YOU LIVED CONTINUOUSLY IN THIS LOCATION? SEX: MALE FEMALE MARITAL STATUS: SINGLE MARRIED WIDOWED OTHER IF MARRIED, OCCUPATION OF SPOUSE: NUMBER OF CHILDREN UNDER 18: NUMBER OF CHILDREN OVER 18: NUMBER OF PEOPLE IN HOUSEHOLD: WHAT IS THE HIGHEST LEVEL OF SCHOOL YOU HAVE ATTENDED? NO FORMAL SCHOOL PRIMARY SECONDARY UNIVERSITY WHAT IS THE HIGHEST GRADE COMPLETED AT THAT LEVEL?  VOCATIONAL  INTERVIEWER VISIT DATE: INTERVIEWER’S NAME: INTERVIEWER’S OBSERVATIONS TO BE FILLED IN AFTER COMPLETING INTERVIEW. COMMENTS ABOUT RESPONDENT:  COMMENTS ON SPECIFIC QUESTIONS:  ANY OTHER COMMENTS:  SUPERVISOR’S OBSERVATIONS:  89  

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