Farm Labor Networks, Cooperatives and Fair Trade: An Empirical Analysis of Peruvian Coffee Growers

Agricultural marketing cooperatives are potentially important tools for rural development. However, many cooperatives experience significant outside sales to private intermediaries. This study analyzes the problem of outside sales in a coffee cooperative in northern Peru, and finds that the labor practices of cooperative members exert significant influence on their level of outside sales. I find that coffee growers who use more intensively cooperative labor networks known as choba-choba, as well as family household labor, engage in fewer outside sales and channel more sales through the cooperative. These results imply a symbiotic relationship between agrarian marketing cooperatives and non-market labor practices, and suggest an important role for robust community structures in building sustainable livelihoods in agrarian regions of the developing world.