Assessing How Shifts in Global Demand for Natural Vanilla Influenced Crime in Madagascar

Nestlé, the world’s largest food and beverage company, announced in 2015 that it would begin using natural vanilla in all of its products. On one hand, this exogenous spike in vanilla prices represented a potential boon to Madagascan farmers, who account for over 80% of the world’s natural vanilla production; on the other hand, it has possibly created new opportunities for predatory actors in producing regions, leading to higher levels of crime and violence. We thus pose the following question: what is the effect of exogenous market shocks, specifically driven by multinational corporations, on local levels of crime? Building off research on the domestic consequences of changes to global commodities and agricultural markets, we postulate that the shift to natural vanilla may have increased local levels of crime where prices greatly outpaced local substitutes. Using a novel dataset on vanilla yield and regional crime in Madagascar, we explore how the market-driven actions of multinational corporations impact personal security in the regions that service these markets. Our research aims to develop broad implications for countries with heavy reliance on agricultural exports by examining the impact of market-driven policy shifts within multinational corporations. We conclude with recommendations that aim to increase the capacity of states to manage unanticipated shifts in commodity prices where citizens are dependent on the stability of global supply chains.