The Informal Economy in Monsoon Asia and Melanesia: West New Guinea and the Malay World

his is the third in a series of papers concerned with the intellectual history of the 'informal economy' and its relevance to current concerns in Papua New Guinea (PNG; the eastern half of the island of New Guinea). Proceeding from the observation that monetized informal economic activity in PNG has been of relatively limited importance, the paper seeks explanations by comparing two stylized constructs, Monsoon Asia (where the informal economy is dynamic) and Melanesia (where it is limited in scope and contribution to livelihoods). Papua (occupying the western half of the island of New Guinea) is seen as a meeting point, or zone of transition, between Monsoon Asia and Melanesia. A long history of 'trading and raiding' on this frontier marked the encounter between ceremonial exchange, as practiced by Melanesians, and the system of tribute imposed on Papuans by Moluccan sultanates. Limited economic specialization and exchange in Melanesia contrasted with the Asian household economy, enmeshed in complex social hierarchies and systems of occupational differentiation. Historically, the Malay Archipelago engaged in a world trading system, into which it drew west New Guinea/Papua over millennia. Travelling peddlers played a key role in the archipelagic trade system, demonstrating the antiquity of the informal economy tradition in the cultures of Monsoon Asia. The paper seeks explanations for the comparative absence of that tradition in Melanesia. Finally, it examines the recent and rapid emergence of an informal economy in Papua, dominated by non-Melanesian immigrants, in the wake of the incorporation of (Dutch) west New Guinea into the Republic of Indonesia in 1963.