free trade fair trade
“Completely free trade would be fair. ‘Fair trade’ encourages people to stay in uncompetitive sectors in which they will always be poor.” Discuss.
The concept of the ‘Fair Trade’ initiative can be summarised with reasonable simplicity; “Fair Trade works to alleviate poverty in the global South through a strategy of ‘trade, not aid,’ improving farmer and worker livelihoods through direct sales, better prices and stable market links, as well as support for producer organizations and communities” (Raynolds and Long 2007 16), “promoting a supply chain that delivers value to the producer and buyer more evenly” (Nicholls and Opal, 2004 12). Essentially, it is exchanges, the terms of which meet the demands of justice (Eisenberg 2005). The alternative, which Fair Trade presents, to the neo-liberal supported free hand of the market theory (which will be analysed shortly), is one which “requires companies to conform to minimum guidelines to be able to make claims of independent certification of Fair Trade standards, competitors play on a more ethical playing field (2004 12). In this essay question, the concept of ‘completely free trade’ would appear to encompass both neo-liberal concepts of ‘free market’ and ‘free trade’; the prior of the two, in short, describes a market system free of (government) regulations on prices and supplies on imports and exports and said prices are established and fluctuate solely as a result of supply and demand on both a local and global level (Bockman 2011). ‘Free market’ is a description of a policy in which there is no interference at government level when it comes to applying neither tariffs to imports nor subsidies to exports (Bhagwati 2002), such a concept ties in with the law of comparative advantage, a concept that finds its origins in the ideas of classical free trade. It theorises that when two countries trade goods that both will come out of the agreement having made a gain on the grounds that they are now in possession of a
The concept of the ‘Fair Trade’ initiative can be summarised with reasonable simplicity; “Fair Trade works to alleviate poverty in the global South through a strategy of ‘trade, not aid,’ improving farmer and worker livelihoods through direct sales, better prices and stable market links, as well as support for producer organizations and communities” (Raynolds and Long 2007 16), “promoting a supply chain that delivers value to the producer and buyer more evenly” (Nicholls and Opal, 2004 12). Essentially, it is exchanges, the terms of which meet the demands of justice (Eisenberg 2005). The alternative, which Fair Trade presents, to the neo-liberal supported free hand of the market theory (which will be analysed shortly), is one which “requires companies to conform to minimum guidelines to be able to make claims of independent certification of Fair Trade standards, competitors play on a more ethical playing field (2004 12). In this essay question, the concept of ‘completely free trade’ would appear to encompass both neo-liberal concepts of ‘free market’ and ‘free trade’; the prior of the two, in short, describes a market system free of (government) regulations on prices and supplies on imports and exports and said prices are established and fluctuate solely as a result of supply and demand on both a local and global level (Bockman 2011). ‘Free market’ is a description of a policy in which there is no interference at government level when it comes to applying neither tariffs to imports nor subsidies to exports (Bhagwati 2002), such a concept ties in with the law of comparative advantage, a concept that finds its origins in the ideas of classical free trade. It theorises that when two countries trade goods that both will come out of the agreement having made a gain on the grounds that they are now in possession of a
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