Pay Fortnight Food Market and Retail Cycles in PNG

A regular cycle of retail activity occurs in urban Papua New Guinea (PNG) that is closely associated with the fortnightly government pay period. Because of the large number of public servants in urban areas, relatively large amounts of money move into the local economy once a fortnight when public servants are paid. This pattern is less striking where there are more private enterprise employers or other sources of income. For example, in the Kimbe area of West New Britain Province, payment to oil palm growers is a major source of income and the government payday effect is less marked.

Public servants do much of their banking and shopping in local food markets and stores on the Friday and Saturday of the government pay week. Villagers often come to their local town on those days, some seeking handouts from their relatives in the paid work force, others to market fresh food when more money is being spent. Thus there are often more sellers and buyers at local markets on these two days than on any other day in the fortnight.

These patterns are illustrated in Figure 1 with sales data of fresh food and betel nut in Kainantu market, Eastern Highlands Province, over a two-week period in 1982. The busiest days for the sale of both fresh food and betel nut in Kainantu are the government pay-Friday and the following Saturday. Sales from a retail store in Kainantu over a 10-week period are shown in Figure 2. At this store, a third of the sales took place on only 2 of the 12 trading days each fortnight. This seems typical of other centres where there are few private enterprise employers.

Figure 1 Value of fresh food and betel nut sold in Kainantu market over a 14-day cycle, July 1982.
Source: Bourke and Nema (1985).

Private sector payday (known as ‘company’ payday) falls on the alternate Friday to the government payday, and contributes to a smaller surge in spending on the Friday and Saturday of the non-government pay week (Figure 2). Although these data were recorded in 1982, the same patterns can still be observed in many urban locations in PNG, including in Port Moresby and the main highlands towns.

Figure 2 Daily sales in a retail store in Kainantu over a 10-week period, January–March, 1982. Note: Sundays are excluded because the store is closed on Sundays. Source: R M Bourke unpublished field notes.

An increase in spending prior to the Christmas break in December forms another retail spending cycle in PNG. It probably occurs because teachers and some other public servants spend much of their holiday pay then. This is recorded as an increase in some sales figures in December. Sales of many items are often very low in January and February, presumably because many people have spent their holiday pay. This annual cycle is not as predictable or as large as the two fortnightly cycles described above, and seems not to affect fresh food markets.

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