Mapping Our Economic Assets: Understanding the Impacts of Ecommerce on Economic Geography and Tribal Economies

Participants at the National Center for American Indians Enterprise Development’s RES 2019 seeking to grow business last week in Las Vegas. Native News Online photo by Levi Rickert

Guest Commentary

Published April 1, 2019

Competitive advantages are keys to developing national economic strategy. This can provide a foundation for higher wages, increased revenues and GDP growth. E-commerce opportunities provide access to new markets, consumers and reduce economic leakages moving economies toward an export-based strategy. Understanding how these advantages fit within other economic systems, cultures and strategies are keys to moving from revenue-based efforts to truly developing reservation-based economies.

These principles apply not only to national economies globally, but also reservation-based economies. Many tribal nations are located in remote rural areas, which makes it difficult to achieve agglomerative benefits to improve economic conditions. Now the bureau of economic analysis has released previous GDP data per counties throughout the US. Specifically, counties that intersect with Native lands can serve as a proxy for reservation related economies. Based on this proxy, reservation related economies represent about 20 % of the total US population and $3,559,820,399,000 Reservation-Related GDP. Specific representations of ecommerce include 27,403 ecommerce related businesses and 605,663 ecommerce related employees.

Related: Economic Analytics Driving Better Economic Decisions for Indian Country

Based on our research ecommerce provides positive economic benefits, but that is not the entire story. Data was gathered from the Bureau of Economic Analysis, US Census Bureau and TIGER Line/US Census Bureau. Using a sample of 591 counties that intersect with Indian lands we are able to research ecommerce, GDP and the impacts of human capital. Ecommerce alone truly needs sufficient human capital to ignite these benefits throughout tribal nations. When controlling for human capital (education) levels we are able to understand the impacts of ecommerce.

Dr. Eric Trevan

Results include that every new ecommerce related business has a positive impact of $1,144,000 on GDP. Additionally, each ecommerce related job has a positive significant impact of $392,000 and each additional individual in the reservation related economies has a positive significant impact of $289,000. With all of these benefits, each ecommerce related business replaces 8 outdated businesses.

Recommendations from our study focus on the need to develop priority objectives which supports higher education. As the catalyst to unleashing ecommerce economic opportunities, this has a positive significant impact throughout the research. Development and implementation of an ecommerce strategy with businesses and public services will support an ecosystem that seeks to create jobs, increase overall GDP and replaces outdated business. Finally, tribal nations need to exercise their sovereignty and utilize their competitive advantages. Native advantages only make a difference if they are utilized and respected.

Eric S. Trevan, PhD, is a national advocate for entrepreneurship, innovation and economic development. He focuses on working with small, minority and Native American business. He is a member of the faculty and on the tenure track for Evergreen State College in Olympia, Washington. Dr Trevan recently ended a term as chairman of Gun Lake Investments, which fosters tribal economic development. He is the past president and CEO of the National Center for American Indian Enterprise Development.

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