Self-employment on Indian reserves

Piotr Wilk
Dept. of Sociology, University of Western Ontario
July, 2005


Using the 1996 Census of Canada and the administrative data from Indian and Northern Affairs Canada, this study examines the nature of self-employment in First Nations communities. The comprehensive model of self-employment proposed here posits that decision to become self-employed is a joint function of characteristics of First Nations communities (contextual effects) and characteristics of prospective entrepreneurs living in these communities (compositional effects). Hierarchical generalized linear modeling techniques were used to conduct the analysis. The results indicate that, at individual level, the probability of self-employment is related to age, educational attainment, gender, marital status, and ethnic origin. The between-reserve variability in self-employment is affected by the following reserve characteristics: relative income from self-employment, the rate of employment in the public sector, the reserve population size, availability of housing infrastructure, and the degree of self-determination. However, the between-reserve variability was found to be unrelated to reserve's unemployment rate, proximity to urban center, cultural heritage, or level of acculturation into the dominant culture. In total, the model accounted for about forty percent of the between-reserve variance in self-employment.