Framework for Understanding Fair Trade Disintermediation

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Abstract

Our research seeks to answer the question of how a conventional commodity supply chain can be transformed into a disintermediated commodity supply chain in the context of the fair trade (FT) movement. We present a normative framework for conceptualizing the disintermediation process, exploring the variables bearing on this process using the case of FT coffee to illustrate our insights. We highlight the motivational sources driving FT, suggesting that it is increasingly to the advantage of multinational enterprises to leverage their market power to circumvent intermediaries in the supply chain and, in so doing, shift a greater share of income and wealth to producing communities. A research agenda centered on building an FT supply-chain disintermediation index is proposed.

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