"Fair Trade - is it really better for workers? - a case study of Kaisa Grass Baskets in Bangladesh"

This paper analyses the extent to which fair trade organisations increase wages for rural poor women.  Based on information gathered from interviews with senior-level managers and artisans in Bangladesh, it presents case studies of kaisa grass baskets manufacturing, giving particular attention to an NGO, a non-profit company, and a for-profit business. The objective is to compare and contrast these organisations in relation to cost structures, the production process of kaisa grass baskets, and wages paid to artisans.

The paper argues that the intent of fair trade organisations is to return a greater share of value-added to the artisans as wages or other non-monetary benefits. One of the prominent claims of fair trade supporters is that fair wages are paid to poor artisans. In the three case studies, artisans receive a subsistence income equivalent to 2% to 6% of the final selling price of their products. Worker incomes hover around subsistence levels and are not very different from what agricultural day laborers in the surrounding areas receive. The For-Profit business pays more in wages than the NGO and Non-Profit company, bringing into question the effectiveness of Fair Trade as a mechanism for raising incomes of the poor in low income countries such as Bangladesh.

key concluding points include:

• fair trade organisations are providing subsistence income to poor women in rural areas, as well as the additional benefit of empowerment that women experience by being paid directly for their work
• with wages being the main indicator used in this paper to measure the effectiveness of fair trade to reduce poverty, the For- Profit is the most effective
• the NGO and Non-Profit do provide a better distribution of profits through the additional services of training in health, literacy, and gender awareness that enable the artisans to grow in areas outside of basket weaving
• two of the organisations also support women empowerment and some partnership with their buyers, something that the For-Profit is not doing. The two fair trade organisations may not be paying the highest amounts in wages, but they do have a thorough approach that focuses on the long-term benefit of the artisans.