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This paper is concerned with the accommodation of Tolai people, indigenous to the Gazelle Peninsula in the hinterland of Rabaul, to the market economy. 'The market' was introduced to Tolai by German (and later, Australian) colonists from the late nineteenth century. Without pretension to novelty in the historical narrative it asserts the value of viewing these events through the lens of 'informal economy', as constructed by Keith Hart. The paper is a companion piece to another study, concerned with the economic history of Chinese immigrants to Rabaul (Conroy, forthcoming). Starting from the proposition that (unlike the Chinese) the Tolai had no tradition of 'trade as a self-sufficient profession', it considers how they adapted their livelihoods to the colonial economy. In German New Guinea, market economic activity was supposed to be conducted in conformity with the norms of a particular model of Weberian 'rational-legal' bureaucracy, introduced by the Reich. In turn, German bureaucratic norms were guided by an ideology of 'national-economic purpose', enunciated for the Wilhelmine state and its colonies. The paper argues that Australian administrators essentially adopted the German bureaucratic framework, while employing it for somewhat different ends. Tolai engagement in the market economy proved to be 'informal', however, in the sense that it did not conform fully with the prescribed bureaucratic norms. It displayed the hybridity found wherever Smithian trade (seen as activated by a natural human tendency to 'truck and barter') is confronted by Maussian exchange (seen as the product of socially regulated customs). The paper considers how tensions between German/Australian expectations of Tolai economic behaviour and the reality of that behaviour played out over the colonial period to 1975. At that time, trade as 'a self-sufficient profession' was still not apparent among the Tolai.
John Conroy lived and worked in PNG over the period 1970-1981, where he lectured in Economics at the University of Papua New Guinea, and served for four years, 1977-81, as Director of the PNG Institute of Applied Social and Economic Research (predecessor of the present National Research Institute). Subsequently, during the 1980s, he lived and worked in Indonesia for six years. He is currently a non-resident Visiting Fellow in the Crawford School. John is preparing a monograph on the idea of the informal economy and its application to PNG. In that connection, he is currently working on the emergence of an informal market economy on the Gazelle Peninsula and the interactions between the native Tolai people and the immigrant Chinese during the colonial period.