Does fair trade really work? Who will pay for Shane Jones’ work? and blogging on NZ aid

NZADDs Devpolicy Blog Series
We have some great new additions to the NZADDs/Devpolicy blog series on New Zealand aid and development policy: Gerard Prinsen writes on New Zealand aid to Africa, Pip Bennett on the need for gender mainstreaming, and Luke Craven about carefully considering how to maximise the benefits of seasonal migration on sending communities. You can access these posts, and the earlier ones in the series from this page. Keep watching, as we have more great blogs to come.

Does fair trade really work?
A friend of NZADDs got in touch in the wake of the last update, asking about the recent SOAS study on the impact of Fairtrade on farm workers in parts of Africa. Reporting the results of the study the Guardian had claimed that: “Sales of Fairtrade-certified products from Uganda and Ethiopia are not benefiting poor farmworkers as profits fail to trickle down to much of the workforce, says a groundbreaking study.”

What is one to make of this? Should we conclude Fairtrade does no good?

The short answer is no: such conclusions are not justified on the basis of the study.

First, the study is on the welfare of farm workers, not on the actual fairtrade farmers themselves, so it is possible that there are benefits accruing to poor agriculturalists, just not to the people they employ. Second, and most importantly, as is explained in this excellent Centre for Global Development blog post, the study does not sufficiently control for reverse causality — it may be that it is the poorest of farms which are attracted to fairtrade production in the first place, and that, in comparison with other farms, this effect offsets any gains that resulted from fairtrade. (This, to be fair, short of running RCTs, is a very difficult methodological issue to overcome, and the study’s authors do try, but the propensity score matching they use is not really up to the task, although it is certainly better than doing nothing). Third, as pointed out in the CGD blog post a number of other studies show evidence of Fairtrade delivering benefits. In the complicated world of development, and amidst the complicated challenges of actually isolating impacts in development research, the best way we have of attempting to answer tricky questions is almost always to look at the weight of evidence, and not just one particular study.

And in Fairtrade’s case the weight of evidence suggests it probably helps, to a degree, in most instances. Although, it would be great if we had better evidence, and great if the Fairtrade movement starting using tools such as Randomised Control Trials to try and help gather this.

Will Shane Jones Really Work?
On the subject of work, we sent in an OIA request to find out about the thinking behind the appointment of Shane Jones as “economic ambassador” to the Pacific. The released documents (MFAT released the same group of documents to ourselves and others who had made similar inquiries) make for an interesting read (not to mention a depressing read if you pay taxes in New Zealand). It is very hard to read the documents and conclude that the role was created for anything other than reasons of New Zealand domestic politics. The blogger NoRightTurn has some good analysis of this here and here. There is no evidence the position is needed or that Jones will be able to deliver anything tangible through it.

The one piece of good news is that, in their response to another OIA, MFAT advised us that Jones will be paid for out of Vote Foreign Affairs, not vote ODA — so at least it won’t be aid money.

Other interesting reading
Elsewhere on the internet, the Australian blog WhyDev has 52 excellent pieces of advice for aspiring development workers (only marred slightly by their claim that aid does not elicit economic growth; if anything the best available evidence suggests on average it does, at least to a small degree).

In the Herald Dita De Boni contrasts the ethical approach New Zealand should take if elected to the Security Council with the McCully-type (Maculliavellian?) approach we are likely to take.

And in the Boston Review Martha Mussbaum does an excellent job of arguing why India needs to aspire to raising human development not just GDP. In the process she does a good job of explaining and arguing for Amartya Sen’s capabilities approach as well (although here in the NZADDs admin division the grumpy utilitarians who work the night shift still remain un-persuaded by Aristotelian political philosophy).

And, if after reading all that, you fancy writing something of your own, the GDN has an essay contest up and running, with a hefty prize too. All you essayists out there, this is your chance to have your say!

That’s all for this month. Remember — if you read something you think we might be interested in including in these updates, please send it through to us. We can’t promise we’ll include it, but we probably will, and these updates are much better when they are a community endeavour (rather than relying solely on grumpy, anti-Aristotelians).

Terence, for NZADDs admin.