The cash incentive : the economic response of semi-subsistent craftworkers in Papua New Guinea

Abstract

This study examines the income-earning potential, the cash expenditure behaviour and the work effort response of a sample of handloom wool weavers who operated in both the remote villages and urban towns of pre-independent Papua New Guinea. Its concern is thus with the response of these workers to the cash incentive. Although weaving represented the main cash-earning activity of the weaver households, they continued to rely on the nonmonetary traditional economy for a substantial part of their livelihood. In the Highlands of New Guinea non-monetary garden production contributed one-third of total household income during the study period. The weaving workforce was selected because of the homogeneity of work effort, because the quantity of work performed and the earning rates of individual workers could be calculated with some precision and because there was a high degree of freedom in the actual work-leisure choice of each participant. It was found that less than 40 per cent of the potential work time available to the average weaver was actually used in effective cash-earning work and, as such, average weekly earnings during the study period were less than 40 per cent of their potential.