Coffee certificates: a profitable strategy for improving the livelihoods of smallholder farmers? Evidence from an impact evaluation in Latin American countries
For the past decades, Voluntary Sustainability Standards (VSS) have been at the forefront of global sustainability governance in the coffee sector, in an effort to ensure transparency for the public and improve the livelihoods of smallholder coffee farmers. Raising farmer’s income and ensuring economic sustainabilityshould be considered a key measure of output legitimacy of certifications, as it has been the main incentive for producers to participate in these schemes. However, as certified products have entered the mainstream market, supply has vastly outpaced demand, thus turning coffee certifications into an entry barrier to certain markets and causing the price premium to erode. In addition, external circumstances beyond certifications such as the price volatility that characterizes the sector, the uneven distribution of value and risks among the coffee value chain, the rise in input and labor costs, as well as the impacts of climate change, pests and diseases, are already pushing coffee farmers beyond the limits of profitability. For all those reasons, the capacity of VSS to ensure economic sustainability at the farm level has been put into question. So far, evidence from qualitative studies and the few rigorous evaluations conducted points to mixed and ambivalent effects of coffee certifications on farmers’ livelihoods. What is more, most of these studies focus only on income from coffee, fail to accurately account for the costs of production and use small and non-representative samples. In my research, I take broader impacts into account, assessing the effects at the plot, farm and household level, and account for substitution effects due to coffee specialization. Using a matched sample of over 1,800 smallholder farmers from cooperatives in Honduras, Colombia and Costa Rica to create a robust counterfactual, I first calculate the costs of production of both certified and non-certified farmers and then evaluate the impacts of third-party labels such as FairTrade, Rainforest Alliance, and 4C, and company-led standards as Nespresso AAA and Starbucks C.A.F.E. Practices, as well as multi-certification strategies. Furthermore, I assess the potential “pathways” or mechanisms to better economic performance, as well as their underlying practices, aimed at identifying the strategies of VSS that yield higher returns for coffee farmers. The results of this study will shed light on the question of the effectiveness of VSS in terms of creating real change on the ground.
02/2018 bis 03/2019 Visiting Scholar beim Agricultural and Resource Economics Department, UC Davis, USA seit 10/2016 Mitglied der Graduate School of Politics (GraSP) an der Westfälischen Wilhelms-Universität Münster seit 04/2016 Wissenschaftliche Mitarbeiterin beim TRANSSUSTAIN Research Project an der Westfälischen Wilhelms-Universität Münster 2014 - 2016 Environment and Energy Technical Assistant beim United Nations Development Programme (UNDP), Lima, Peru 05/2014 Master of Arts in "Sustainable International Development" an der Heller School for Social Policy and Management, Brandeis University, USA 09/2009 Bachelor of Arts in "Social Sciences" an der Pontificia Universidad Catolica del Peru (PUCP), Lima, Peru
Dietz, T., Estrella, A., Font Gilabert, P., Grabs, J. (2018) Women’s empowerment in rural Honduras and its determinants: insights from coffee communities in Ocotepeque and Copan, Development in Practice, 28:1, 33-50, DOI: 10.1080/09614524.2018.1402862.
Dietz, T., Auffenberg, J., Grabs, J., Estrella, A., Kilian, B. (2018) The Voluntary Coffee Standard Index (VOCSI). Developing a composite index to assess and compare the strength of Mainstream Voluntary Sustainability Standards in the global coffee industry, Ecological Economics 150, 72-87. DOI:10.1016/j.ecolecon.2018.03.026.
Dietz, T., Estrella, A. Coffee certifications: a profitable strategy for improving the livelihoods of smallholder farmers? Evidence from an impact evaluation in Colombia’s coffee belt (revise & resubmit in The Journal of Development Studies).
Estrella, A. (2014). Mitigation and opportunities for Peru. Humanum magazine, United Nations Development Programme in Latin America.
Folgenabschätzung, angewandte Ökonometrie, marktbasierte Naturschutzmechanismen, private Nachhaltigkeitsinitiativen, nachhaltiger Ressourcen Ge- und Verbrauch, nachhaltige Landwirtschaft, Anpassung an den Klimawandel, erneuerbare Energien und Energieeffizienz.