This chapter will turn to the economy of the ethnic boundary. While publicly exploited as a source of conflict, the ethnic divide simultaneously provides a space for social, political and economic activities outside local communities and kin groups. Ethnicity is also an important argument when dealing with bureaucracy and development organizations. The first part of the chapter engages with the hidden ethnic economy of rural agro-pastoral production systems, after which the focus is on ethnicity and national bureaucratic practice.

Previous examples have shown how the ethnic divide provides a screen behind which farmers hide their cattle and withhold them from the web of reciprocal obligations within the kin groups. The transfer of cattle and herding labour goes hand in hand with a shift in the modes of exchange: cattle are also moved from the sphere of commodity exchange into one dominated by the rhetoric of gift exchange.

Being landless, Fulbe herders often seem to accept inferior status and thus also accept dependence on farming communities to receive lands for settlement and pasture. At the same time, however, passing control over land and resources on to the farmers in turn allows the local herders to ward off claims by transhumant pastoralists without having to violate intra-ethnic (and intra-kin) obligations of sharing. In this respect, the Fulbe herders profit from the public over-emphasis of conflict and maintain the image of an impermeable and high-risk boundary: this helps to conceal cross-cutting ties that permit resident local herders to share local resources with the farmers, while the transhumant herders are excluded from this hidden network.