The Impact of Self-Government, Comprehensive Land Claims, and Opt-In Arrangements on Income Inequality in Indigenous Communities in Canada

Abstract

In Canada, self-government agreements, comprehensive land claims agreements, and opt-in arrangements allow Indigenous groups to govern their internal affairs and assume greater responsibility and control over the decision-making that affects their communities. We use difference-in-difference models to measure the impact of such agreements on average income and income inequality in Indigenous communities at the community level. In comparison with earlier work, we additionally use data from the 2016 Census. Our results suggest that comprehensive land claims agreements increase community-level average (log) household incomes by more than C$10 thousand (0.25 log points). Attainment of other agreement types does not increase community-level average incomes. Communities that attain a self-government agreement or an opt-in arrangement related to land management see a decrease in the Gini coefficient for income inequality of 2.0 to 3.5 percentage points. Standalone comprehensive land claims agreements are associated with a smaller decrease of 1.2 percentage points. We also study intergroup inequality and find that an opt-in arrangement increases within-community income disparity between Indigenous and non-Indigenous households.