Gifted Slacker

I no longer have to feel bad about not giving a shit about not buying into the whole “fair trade” scheme. Fair trade (and similar fads) always seemed a bit fishy to me.

Peter Boettke wonders if the content of the above Starbucks marketing message is just an application of material learned in an introductory economics course. And, Matt Dobra replies in a comment on this The Austrian Economists post:

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First, this “fair trade” coffee business is mostly a response to the huge drop in wholesale coffee prices between 1997 and 2004, where prices dropped by about 66%. According to ECON 101, some curve probably shifted. In this case, it was the supply curve, as Vietnam entered the coffee market with surprising efficiency, meaning existing, higher cost producers were pushed out of the industry. So fair trade is little more than subsidizing inefficient producers. Fair trade coffee is about as good an idea as trade protection for the sake of saving jobs in a country that is an inefficient producer, and what grade do you give a ECON 101 student who advocates that?.
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I love Matt’s parting shot, too:

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In the end, it is the ECON 101 student who tells me this is a good marketing ploy that plays upon both the misguided social conscience and the economic illiteracy of the masses is the one that gets the good grade.