Rice farmers' preferences for fairtrade contracting in Benin: Evidence from a discrete choice experiment

Private standards such as Fairtrade have emerged as a response to consumer, civil society and corporate concerns about the production conditions of imported food. Many studies have investigated the welfare implications of smallholder participation in Fairtrade schemes and consumers' willingness to pay for Fairtrade and other labelled products. On the other hand, no study has yet investigated farmers' preferences for Fairtrade and other private standards. Such insights would be valuable to improve the efficiency of certification schemes and ensure that they are tailored to farmers' needs. Using a choice experiment, this study investigates the preferences of smallholder rice farmers in Benin for Fairtrade and Organic standards and compares the value of three types of contracts (domestic, Fairtrade, and Fairtrade-Organic). The results indicate that farmers positively value contracts, but prefer domestic over Fairtrade contracts because the former involve fewer requirements. At current market prices, farmers are willing to accept a Fairtrade contract that includes fertiliser and child labour restrictions and a social premium, but they are not willing to accept a Fairtrade-Organic contract that completely prohibits chemical input use. The results imply that adding organic requirements to Fairtrade contracts may undermine the adoption and spread of Fairtrade certification in the Beninese rice sector.