Categories: ECONOMY

Why Some US Indian Reservations Prosper While Others Struggle


Our colleague Thomas Stratmann writes about the political economy of Indian reservations in his excellent Substack Rules and Results.

Across 123 tribal nations in the lower 48 states, median household income for Native American residents ranges from roughly $20,000 to over $130,000—a sixfold difference. Some reservations have household incomes comparable to middle-class America. Others face persistent poverty.

Why?

The common assumption: casino revenue. The data show otherwise. Gaming, natural resources, and location explain some variation. But they don’t explain most of it. What does? Institutional quality.

The Reservation Economic Freedom Index 2.0 measures how property rights, regulatory clarity, governance, and economic freedom vary across tribal nations. The correlation with prosperity is clear, consistent, and statistically significant. A 1-point improvement in REFI—on a 0-to-13 scale—correlates with approximately $1,800 higher median household income. A 10-point improvement? Nearly $18,000 more per household.

Many low-REFI features aren’t tribal choices—they’re federal impositions. Trust status prevents land from being used as collateral. Overlapping federal-state-tribal jurisdiction creates regulatory uncertainty. BIA approval requirements add months or years to routine transactions. Complex jurisdictional frameworks can deter investment when the rules governing business activity, dispute resolution, and enforcement remain unclear.

This is an important research program. In addition to potentially improving the lives of native Americans, the 123 tribal nations are a new and interesting dataset to study institutions.

See the post for more details amd discussion of causality. A longer paper is here.

The post Why Some US Indian Reservations Prosper While Others Struggle appeared first on Marginal REVOLUTION.



Source link

Mainedigitalnews.com

Share
Published by
Mainedigitalnews.com

Recent Posts

Great service

Alliance Taxi Barrie were exceptional since the first second I wrote to them. Smooth process…

2 days ago

Still Point Theatre Collective’s Second Annual Social Change Theatre Festival

By . Still Point Theatre Collective, a Chicago-based organization dedicated to using theatre as a…

2 days ago

Watch: Igor Shesterkin scores the first goalie goal in Rangers history

Igor Shesterkin has scored the first goalie goal in Rangers history. With less than three…

2 days ago

Ethan Hawke on his role in tense 2001 drama Tape

Shot in six days using handheld digital-video cameras, the 86-minute film stars Hawke, his then…

2 days ago

The top private sector employers of economics graduates

Here is the link. The post The top private sector employers of economics graduates appeared…

2 days ago

The 12 Best Education Apps For Android

The best education apps for Android give learners something useful to do: solve a problem,…

2 days ago