Social standards, worker welfare and women's empowerment in modern agri-food systems: A case study of horticultural wage workers in Ghana

The world agricultural trade system has experienced tremendous changes in recent years. Agri-food systems are increasingly shifting towards more vertically integrated production systems that are based on commercialization and mechanization. As part of this trend, food quality and safety standards have gained in importance. These developments have also led to an increased consolidation of production units. Large-scale horticultural and floricultural plantations have emerged particularly in developing countries producing vegetables, fruits, and flowers mainly for Europe and the United States. In countries where agricultural production is predominantly characterized by small farmers supplying to local spot markets, this agricultural shift and its consequences for the rural poor needs to be better understood. While an increasing body of literature has analyzed ramifications for smallholder farmers, implications for the welfare of workers and their households are yet to be thoroughly assessed. This dissertation addresses this research gap by providing empirical evidence from the export pineapple sector in Ghana where large-scale producers dominate. It is composed of three manuscripts, which contribute to the literature by addressing two overarching research questions: (1) does wage employment on horticultural export-oriented plantations contribute to women’s empowerment? And (2) does the sustainability standard Fairtrade improve the quality of wage employment on plantations? To answer these questions, we utilize original survey data from households living in the vicinity of pineapple plantations, many of whom are employed there. The compiled data contains information on employment characteristics, socio-demographic information and gender roles within the household. Additionally, company-level information, including capacity and size, are taken into account in the dissertation’s econometric analysis. In chapter I, we introduce the trends and developments of modernizing agri-food systems and provide a conceptual framework for analysis. Following insights into the case study background in Ghana, we focus on the social changes for households engaged in plantation agriculture. Chapter II presents the first manuscript, where feminized employment patterns associated with horticultural export production are analyzed. By using gender-disaggregated data from married households in the sample, we identify wide-ranging indicators reflecting women’s empowerment related to resources, such as income, assets, mobility, and time and inputs into decision-making in the household. We apply a new re-weighting technique, called entropy balancing, in combination with regression analysis. Additionally ordinary least squares regression and propensity score weighting are used for comparison and ensuring robustness of the findings. The results show that women employees contribute a much higher share to the overall household income in comparison to women involved in farming or small-scale businesses. They are also more mobile in their travels, have greater control over assets and spend less time on reproductive household tasks. Women employees also report to have a higher input into household decision-making. The second manuscript, which is presented in chapter III, focuses on the individual worker level in regards to employment conditions on large-scale plantations. We contribute to the literature on private standards in developing countries’ agricultural production systems by considering the effect of the well-established sustainability standard Fairtrade on worker welfare. Using data from 325 workers in eight different pineapple companies in Ghana, we analyze worker’s hourly wages and level of satisfaction with their work. We apply a linear, linear mixed model and instrumental variable approach and find that both worker’s wages and job satisfaction are higher on Fairtrade certified plantations. Increased levels of job satisfaction are associated with higher wages, improved access to services, contract conditions, leave regulations and labor unions. Beyond Fairtrade’s individual effects for workers, we address its potential for improving broader socio-economic welfare for their households in the third manuscript (chapter IV). We assess the role of Fairtrade on household income, asset accumulation and standard of living via regression analysis and matching approaches. We account for company characteristics by including the scale of production and productivity levels into the analysis. The findings show a positive effect of Fairtrade certification on the selected outcome variables. Higher incomes and asset accumulation are most likely driven by higher wages and the ability of Fairtrade companies to ease household expenditures through the provision of free or subsidized services and loans. Also, better access to electricity and clean drinking water (as proxies for standard of living) is linked to the standard, as Fairtrade funds are used for providing worker communities with economic, health and educational amenities. We conclude the dissertation in chapter V. with a summary of the findings of all three manuscripts and how these can translate into viable policy recommendations. Plantation agriculture is often regarded as exploitive towards its agricultural workers and therefore unable to generate positive social change. Our findings show that this is not necessarily the case. For policy makers, this means that fostering plantation agriculture can be a viable strategy to help poor households to generate an income. Work regulations and employment conditions should however be regulated and monitored. Certification schemes, such as Fairtrade, can improve worker welfare and help to set standards within a sector. The world agricultural trade system has experienced tremendous changes in recent years. Agri-food systems are increasingly shifting towards more vertically integrated production systems that are based on commercialization and mechanization. As part of this trend, food quality and safety standards have gained in importance. These developments have also led to an increased consolidation of production units. Large-scale horticultural and floricultural plantations have emerged particularly in developing countries producing vegetables, fruits, and flowers mainly for Europe and the United States. In countries where agricultural production is predominantly characterized by small farmers supplying to local spot markets, this agricultural shift and its consequences for the rural poor needs to be better understood. While an increasing body of literature has analyzed ramifications for smallholder farmers, implications for the welfare of workers and their households are yet to be thoroughly assessed. This dissertation addresses this research gap by providing empirical evidence from the export pineapple sector in Ghana where large-scale producers dominate. It is composed of three manuscripts, which contribute to the literature by addressing two overarching research questions: (1) does wage employment on horticultural export-oriented plantations contribute to women’s empowerment? And (2) does the sustainability standard Fairtrade improve the quality of wage employment on plantations? To answer these questions, we utilize original survey data from households living in the vicinity of pineapple plantations, many of whom are employed there. The compiled data contains information on employment characteristics, socio-demographic information and gender roles within the household. Additionally, company-level information, including capacity and size, are taken into account in the dissertation’s econometric analysis. In chapter I, we introduce the trends and developments of modernizing agri-food systems and provide a conceptual framework for analysis. Following insights into the case study background in Ghana, we focus on the social changes for households engaged in plantation agriculture. Chapter II presents the first manuscript, where feminized employment patterns associated with horticultural export production are analyzed. By using gender-disaggregated data from married households in the sample, we identify wide-ranging indicators reflecting women’s empowerment related to resources, such as income, assets, mobility, and time and inputs into decision-making in the household. We apply a new re-weighting technique, called entropy balancing, in combination with regression analysis. Additionally ordinary least squares regression and propensity score weighting are used for comparison and ensuring robustness of the findings. The results show that women employees contribute a much higher share to the overall household income in comparison to women involved in farming or small-scale businesses. They are also more mobile in their travels, have greater control over assets and spend less time on reproductive household tasks. Women employees also report to have a higher input into household decision-making. The second manuscript, which is presented in chapter III, focuses on the individual worker level in regards to employment conditions on large-scale plantations. We contribute to the literature on private standards in developing countries’ agricultural production systems by considering the effect of the well-established sustainability standard Fairtrade on worker welfare. Using data from 325 workers in eight different pineapple companies in Ghana, we analyze worker’s hourly wages and level of satisfaction with their work. We apply a linear, linear mixed model and instrumental variable approach and find that both worker’s wages and job satisfaction are higher on Fairtrade certified plantations. Increased levels of job satisfaction are associated with higher wages, improved access to services, contract conditions, leave regulations and labor unions. Beyond Fairtrade’s individual effects for workers, we address its potential for improving broader socio-economic welfare for their households in the third manuscript (chapter IV). We assess the role of Fairtrade on household income, asset accumulation and standard of living via regression analysis and matching approaches. We account for company characteristics by including the scale of production and productivity levels into the analysis. The findings show a positive effect of Fairtrade certification on the selected outcome variables. Higher incomes and asset accumulation are most likely driven by higher wages and the ability of Fairtrade companies to ease household expenditures through the provision of free or subsidized services and loans. Also, better access to electricity and clean drinking water (as proxies for standard of living) is linked to the standard, as Fairtrade funds are used for providing worker communities with economic, health and educational amenities. We conclude the dissertation in chapter V. with a summary of the findings of all three manuscripts and how these can translate into viable policy recommendations. Plantation agriculture is often regarded as exploitive towards its agricultural workers and therefore unable to generate positive social change. Our findings show that this is not necessarily the case. For policy makers, this means that fostering plantation agriculture can be a viable strategy to help poor households to generate an income. Work regulations and employment conditions should however be regulated and monitored. Certification schemes, such as Fairtrade, can improve worker welfare and help to set standards within a sector.