, Volume 86, Issue 1 Supplement, pp 63-79
Date: 08 May 2008

The Institutionalization of Fair Trade: More than Just a Degraded Form of Social Action

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The context of economic globalization has contributed to the emergence of a new form of social action which has spread into the economic sphere in the form of the new social economic movements. The emblematic figure of this new generation of social movements is fair trade, which influences the economy towards political or social ends. Having emerged from multiple alternative trade practices, fair trade has gradually become institutionalized since the professionalization of World Shops, the arrival of fair trade products in the food industry, and the establishment of an official “fair trade” label. With the strength that this institutionalization has generated, fair trade can now be considered a real trade system that questions, as much as it renews, the traditional economic system. In parallel, this transformation has exacerbated the tensions within the movement, which can be characterized as a clash between a “radical, militant” pole and a “softer, more commercial” one. However, it is not the actual institutionalization of fair trade which is being debated among fair trade actors on either side of the fence, but rather the challenges inherent in finding an economic institutionalization acceptable to social economic movements. Therefore the institutionalization process of fair trade should not be seen as mere degradation of social action, but rather as typical of the institutionalization process of new social economic movements. If we need to worry about the highjacking and alteration of the fair trade movement by the dominant economic system, the opposite is no less likely, as new social economic movements contribute to an ethical restructuring of markets.