Abstract:
Garment industry is sadly characterized by the endemic problem of labor exploitation. This research
has discussed how the difference between gross margin and markup biases the perception of
consumers regarding profits of sellers when reporting discounts. Because of this different form of
presenting such price information, consumers evaluation of possible labor exploitation is more
difficult to make. Finally, we show with an empirical example what do $14 and $9.6 shirts really cost,
providing the gross margin, markup and how these quantities would vary after paying a living wage
to workers. Doubling or tripling the workers' salary would make big brands also highly profitable. |
