Digital Commons Network^™

The Elimination Of Madagascar’S Vanilla Marketing Board, Ten Years On, Laure C. Dutoit, Olivier Cadot, Jaime De Melo

Olivier Cadot

This paper explores how the elimination of Madagascar’s Vanilla Marketing Board (VMB) in 1993 affected prices paid to farmers, incentives, and regional indicators of poverty and inequality. After steadily losing market share, Madagascar has been able to regain some of the lost ground since the mid-1990s. Margins between FOB and farmgate prices have narrowed down and analysis of changes in poverty and inequality suggests some positive impact in regions where vanilla is grown, though it is difficult to control for other intervening factors. A counterfactual analysis based on a model of Cournot competition between vanilla traders suggests that whatever limited …