Assimilation and economic development: the case of federal Indian policy

Abstract

Throughout the nineteenth century, federal Indian policy oscillated between two extreme positions: assimilation versus isolation. While scholars have often been interested in the impact of past federal policy on current levels of economic development among American Indian tribes, none have explicitly examined the influence of federal assimilation policy on long-run economic development. In this paper, I take advantage of tribal-level variation in the application of federal policies to estimate the effect of assimilation on long-run economic performance. To quantify the impact of such policies, I introduce a novel measure of cultural assimilation: the prevalence of traditional indigenous names relative to common American first names. To calculate the distribution of name types, I have gathered the names and locations for all American Indians enumerated in the 1900 United States census. After classifying each name, I calculated the reservation-specific share of non-indigenous names. I estimate the relationship between cultural assimilation in 1900 and per capita income from 1970 through 2020. I find that historical levels of assimilation are consistently associated with higher levels of per capita income in all census years. The results are robust to the inclusion of a variety of cultural and institutional controls and regional fixed effects.