How are fair prices set?

My colleague, Juliane Reineke,  just published the article “Beyond a subjective theory of value and towards a ‘fair price’: an organizational perspective on Fairtrade minimum price setting” in Organization 17(5): 563-581. The abstract looks promising, but I haven’t yet read the article:

This article explores Fairtrade minimum price setting as an organizational formulation of a critical response to economic liberalism and its underlying notion of value—a subjective theory of value. The aim of the article is to show what happens if such meta-level philosophical debates on fairness and markets are lived out organizationally. This is achieved by using an ethnographic study of the price setting process of the Fairtrade Labelling Organizations. The case unpacks the complexities of defining a ‘fair’ price beyond the principle of marginal utility. I draw on French pragmatist sociology in order to decompose the political and moral constructions that underpin the organizational practices of minimum price setting. Challenging the assumption of free choice in neo-classical economics, Fairtrade redefines not only how value should be calculated, but also what it is it that should be valued and who values. This makes visible the political confrontation at the point of price determination, notably by providing a social arena for where conflicts of interest between opposing parties are played out. Once the producer enters price formation processes as a person and not only as the alienable owner of a commodity, the social, political and ecological and relations of production come to the fore that are otherwise concealed through the spontaneous market mechanism.

Juliane wrote her PhD on “Corporate Social Responsibility, Ethical Consumption, Moral Agency versus Market Rationality” at Judge Business School, Cambridge,

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