Are Fair Trade Goods Credence Goods? A New Proposal, with French Illustrations

Les produits du Commerce Equitable sont-ils des biens de croyance ?

Gaëlle Balineau and Ivan Dufeu ()
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Gaëlle Balineau: CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique
Ivan Dufeu: LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - IEMN-IAE Nantes - Institut d'Économie et de Management de Nantes - Institut d'Administration des Entreprises - Nantes - UN - Université de Nantes, GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage

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Abstract: In the literature, Fair Trade (FT) goods areusually associated with other products differentiated byprocess attributes such as organic food, genetically mod-ified (GM) food or child labour-free clothing. All of theseproducts are regarded ascredence goods. This classificationrefers to the simplified definition of credence goods,which describes product attributes which consumerscannot evaluate, even after having consumed the good.Focusing on the characteristics of FT goods, this articleproposes a reassessment of the link between FT goods andcredence properties as defined by Darby and Karni. Wefirst demonstrate that (1) the usual classification masksimportant particularities of FT goods compared to othergoods with process attributes and (2) the full definition ofcredence goods may even provide a better description ofthe quality of FT goods. However – and this is our secondtheoretical contribution – the lack of consensus amongexperts concerning FT standards and their level of effi-ciency encourage us to consider FT goods asindeterminategoodsas defined by Lupton. This result leads us to suggesta new typology of product attributes summarized in aninnovative diagram. It sheds light on how competitionbetween the different FT approaches works and why theFT market is still confined to a niche, if not threatenedwith collapse. We mainly illustrate our theoretical analysiswith observations relating to the French FT market andinstitutions.

Keywords: symmetric information; credence goods; Fair Trade; indeterminate goods; labels; uncertainty; control (search for similar items in EconPapers)
Date: 2010-04
Note: View the original document on HAL open archive server: https://univ-angers.hal.science/hal-02814413
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Citations: View citations in EconPapers (23)

Published in Journal of Business Ethics, 2010, 92 (S2), pp.331-345. ⟨10.1007/s10551-010-0577-z⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02814413

DOI: 10.1007/s10551-010-0577-z

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