Co-Authored By:
Asked by: Deidre Harchenko
business and finance environmental services industryIs free trade or fair trade better for consumers?
While free trade aims at attracting more consumers to increase sales turnover and generate more profits, fair trade aims at educating the consumers about the benefits of producing goods without the exploitation of labor or the environment.
Just so, which is better free trade or fair trade?
Free trade focuses on the reduction of barriers and policies that favor certain countries or industries. Fair trade, however, favors the rights of workers, improved working conditions and seeks to eliminate pay discrepancies from country to country.
Similarly one may ask, why is fair trade better than normal trade?
Higher prices mean limited customers – Fair Trade products tend to be pricier than free trade items. While this is what allows workers to earn a good wage, it can also limit the customer base of Fair Trade products to those who are able to afford them. Others may be forced to purchase cheaper products of less quality.
Fairtrade means fair wages for farmers For most Fairtrade goods there is a Fairtrade minimum price which acts as an important safety net, protecting farmers from fluctuating market prices. This ensures farmers can earn and expect a stable income and plan for their future.