A great deal of attention is now focused on economic development in Indian Country and not just because of the obvious wealth generated by some casinos and other tribal enterprises. Reservation communities are growing both as a result of the younger demographics and because many retirees are returning home. This growing population coupled with the expansion of successful tribal enterprises makes tribal governments key players in regional economies. The focus in many tribes on the need to address persistent poverty as well as the development of policies that provide incentives in high-poverty communities (Clement, 2006b) and the opportunity for Tribes to take over many BIA functions (healthcare for example) are fueling both the interest in and expansion of entrepreneurial activity on reservations.

Entrepreneurial Strategies for Business Development and Jobs in Indian Country

Entrepreneurship plays a role in two very different approaches to economic development in Indian Country. The particular mix of these strategies depends on the cultural preferences of a particular tribe as well as the mix of existing natural resources, local capacity to implement economic development strategies, and the policies of the tribal government.

Tribal Enterprises: These economic engines emerge from entrepreneurial ventures pursued by Tribally-based organizations. Gaming often comes to mind when we think of tribally-based enterprises. In addition to gaming, Tribes have successfully invested in a number of ventures including energy, e-commerce, and natural resource-related businesses. The profits from these businesses are also invested differently among the Tribes; some focus specifically on per capita payments providing tribal members with regular income regardless of their connection to that enterprise much like stock dividends. These payments range form $110,000 to around $4000 per year (Clements, 2006c). In contrast, other tribes have developed long-term economic and social development plans in which to invest these profits. Many Tribes rely on a combination of these approaches.

Business Development: Despite the strength of the myth circulating about Indian Country that cultural traditions and past dependent relations mean that Indian people do not make good entrepreneurs, entrepreneurship is alive and well on many reservations. Recent work by the Corporation for Enterprise Development (CFED) offers powerful data to contest this myth. In addition, the Northwest Area Foundation report (Malkin, 2004) on Native Entrepreneurship includes data from the US Indian Arts and Crafts Board that reported 1997 sales well over $100 Billion. Specifically, the Santa Fe Indian Market had sales of $19 million over a two-day period. In addition to the artisans, many Indian people run successful technology-based businesses that manage data, design web sites, and provide a wide range of other electronic information services while others run successful agricultural and construction businesses. Beyond the financial impacts of successful entrepreneurship, one entrepreneur reported that “small business activity has a tremendous psychological and emotional impact on reservation people, particularly reservation youth. When they see businesses sprouting up, they see hope for the future” (Cornell, 2006: p.4).

Strategies that Promote Successful Economic Development

The Harvard team identified three areas that contribute to economic development. And focused on those “that tribes can actually do something about as they try to expand tribal sovereignty and improve the economic welfare of their people” (Cornell and Kalt, undated, p 5). Cornell and Kalt also developed a schema to help tribal enterprise boards and governments evaluate which factors they have some control over as a way to focus their economic development efforts: including external opportunities (political sovereignty, market opportunities including distance to markets and access to capital) and internal opportunities (natural resources, human capital, governing institutions, and tribal culture) and development opportunities. They determined that tribes have a high degree of control over development strategies and natural resources. However, tribes can also reshape governing institutions, strengthen political sovereignty, and improve the use of internal assets to increase their chances of successful economic development. Within this context, we see more interest in and work toward supporting both tribal and individual entrepreneurship.

Bregendahl and Flora (2003) identified 7 components of a successful business development strategy including: access to services, credit and financing, value chains and marketing and building social capital within the community and out to other resources and markets, cultural capital, human capital and tribal assets. In the learning circles they conducted, they also identified 10 indicators of business success:

• Results in veneration of cultural rituals and heritage
• Results in Improved quality of life for tribal members
• Builds of individual, community and tribal confidence
• Forms quality interpersonal relationships
• Preserves and protects cultural values
• Generates a sustainable income.
• Contributes to community service
• Helps build a robust local economy
• Provides a connections between the land and business owners and their families
• Offers lifelong education opportunities (2006, p. 59)

As part of the National Coalition for Entrepreneurship’s Listening Sessions on Rural Entrepreneurship, tribal council members, entrepreneurs and others gathered for the Trading at the River session in Portland, and listening sessions in Bozeman and Bismarck. A summary of the Trading at the River is available at: http://www.nationalcoalition.wsu.edu/documents/TATRsummary-collage.pdf

Prepared by Mary Emery, Associate Director, NCRCRD

References

Bregendahl, Corry and C.B. Flora. 2003. “Native American Business Participation in E-Commerce: An Assessment of Technical Assistance and Training Needs.” (RRD 185). Ames, IA: North Central Regional Center for Rural Development. http://www.ag.iastate.edu/centers/rdev/pubs/contents/ecommercebook.pdf

Clement, D. 2006a. “The wealth (and povertyh) of Indian nations.” Fedgazette, March.

Clement, D. 2006b. “Indianpreneurs: Small business development holds great promise for American Indian economic progress, but big obstacles remain.” Fedgazette, March.

Clement, D. 2006c. “Tribal Trends.” Fedgazette, March.

Cornell, Stephen P. and Joseph Kalt, eds. No Date. “What Can Tribes Do? Strategies and Institutions in American Indian Economic Development.” http://www.ksg.harvard.edu/hpaied/docs/reloading%20the%20dice.pdf (10, August 2006).

Cornell, S. 2006 “Community Dividend”. Fedgazette, March

Malkin, J. 2004. Native Entrepreneurship: Challenges and Opportunities for Rural Communities. Northwest Area Foundation. http://www.nwaf.org/Content/Files/Native_Entrepreneurship1.pdf Downloaded March 22 2007.