Download Forest Economics

University of Alberta
Measuring Forest Dependence: Implicutiom fur Aboriginal Communities
by
Dianne Korbu
0
A thesis submitted to the Faculty of Graduate Studies and Research in partial
fdfilhent of the requirements for the degree of Master af Science
Forest Economics
Department of Rural Economy
Edmonton, Alberta
Spring 1997
M*u
National Library
of Canada
Biblioth&que nationale
du Canada
Acquisitions and
Bibliographic Sewices
Acquisitions et
services bibliographiques
The author has granted a nonexclusive licence allowing the
National Li'brary ofCanada to
reproduce, loan, distn'bute or sell
copies ofhismer thesis by any means
and in any form or format, making
this thesis available to interested
persons.
The author retains ownership of the
copyright in hismer thesis. Neither
the thesis nor substantial extmcts
fkom it may be printed or otherwise
reproduced with the author's
permission.
L'auteur a accord6 m e licence mm
exclusive permettant a la
%iblioth&penationale du Canada de
reprohire, p d k , dktri'buer ou
vendre des copies de sa Wse de
fonne qpe ce soit pour mettre des
exemplaires de cette these a la
disposition des pasonnes int6ress6es.
L'auteur conserve la proprietti du
b i t d'auteur qui prottge sa hibe.Ni
la these ni des errtraits substantiek de
celle-ci ne doivent &re imprimCs ou
au!rementreproduits sans son
Abstract
Past studies of ec~nomic base measures of forest dependence have
inadequately addrrssed the full nature of economic forest dependence in Aboriginal
communities, by either i g n o ~ gthe contribution of the subsistence economy or
exduding Indian rtstrves. This thesis presents findings based on the recalculation of
an economic base measure of forest industry dependence (using 1991 census data, and
including a trrnsfer payment sector) which show that omitting Aborigind communities
fiom forest industry dependence measures represents an omission in the number of
fonst industry &pendent communities and population in the prairie provinces.
The economic base masure of forest industry dependence is also evaluated for
potential to include a subsistence economy-related sector. Analysis reveals that the
economic base measure does not adequately capture the contribution of in-kind
income ftom subsistence activities. If the subsistence sector is included in the forest
industry dependence measure the relationships predicted by economic base theory do
not hold, and the forestry industry dependence measure no longer provides a usefid
means to rank and compare f m t industry dependent communities.
In areas where then is reliance on income fiom forest industry related jobs, as
and/or the subsistence economy, a more comprehensive 8ccount of forest dependence
must be developed to fully understand the e&cts of changes in forest industry markets
and forest poky on comm-'
practiced.
economies where the subsistence economy is
Writing this thesis presented a variety of challenges that were met with the
guidana and support fkom a n u m b of people to whom I would like to extend my
gratitude.
Fmaacial support for this research was provided by the Canadian Forest
Semite through the Canada-Saskatchewan Partnership Agreement in Forestry. I am
also grateful for the cooperation &om the Waterhen Fist Nation in Saskatchewan for
allowing me access to community traditional harvest data.
Thank you to m y s u p e ~ o r s Marty
.
Luckert aad Tom Becky, and also to
B 4 Whia for comments on earlier drafts. The quality of this thesis was greatly
enhanced by your insights and editorialpuseverance.
I would like to thank the staff of the Department of Rural Economy, and the
Regional Development program of the Northern Forestry Centre (Edmonton).
Mom and Dad,thank you for your u n w a v e ~ gfaith in me and support
Thank you Paulo for goiug through the highs and lows of graduate studies with
me.
Tubie of Contents
Chapter 1.0: Introduction
1.1. StudyRoblem
1.2. Rcsarch Objectives and Rrrpo6e
1
1
3
Cbpter 2.0: Literature Review and TheoreticaI Background of Economic
Base Zheory
2.1. Past Studies of Community Resource Dependence
2.2. Missmhg Dependence as a Function of the Economic Base
5
5
7
Chapter 3.0: Including Indian Reserves, Rural Districts, and Tranrfer Payments
in the Anaiysis of Economic Bare Dependence
17
3 1 Rationale for the Inclusion of Indian Reserves, Rural Districts,
and the Trader Payment Sector in Forest Industry Dependence
Calculations
17
3.2. Transfer Payments
20
3.3. Remlts
22
3.3.1. Forest Industry Dependent Communities, bcluding Ladian
Resaves, Rural Districts and Transfix Payments,
1986 and 1991
3.3.2. Forest Industry Dependent Communities,Including Mian
Reserves and Rural Districts, 1991
3.3.3. Forest Industry Dependent Commetia, Including Indian
Rcservts, Rural Districts, and the T r d e r Payment
Sector, 1991
Chapter 4.0: Defining Subsistence According to Economic Base Theory:
h@cations for Forest Policy
4.1.
4.2.
4.3.
Importance of the Subsistence Economy in Aboriginal
Communities in the Northern Prairie Provinces
Theoretical and Policy Considerations for the Fanst Industry
Dependence Index of Including the Subsistence Economy
4.2.1. Subsistence Activities asNon-BasicActivitics
4.2.2. Subsistence Activities as Basic Activities
4.2.3. The Forest Industry Dependence Index with the
Subsistence Sector as Basic Activity: A Case Study in
Waterhen, SK
Economic Basic Measures and Intersectoral Effects of Market
and Policy Shocks
Chapter 5.0: Conclusions and Recornme~tions
for Further Research
References
Appendix I .
Appendir 2.
Census Data Issues for the Calculation of the Fmst Industry
Dependence Indar
61
Aggregation of Standard Industrial ClassificationCodes (1980)
into Sectors
63
Appendix 3.
Table 3.1.
Table 3.2.
Table 3.3.
Appendix 4.
Forest Ihdustry Dependence of Rairie Province
Communities, Excluding InReserves, Rural Districts,
65
and Populations of 250 Persons a Less, 1991
Forest hdustry Dependence of Prairie Province
Communities, Including Indian Reserves and Rural Districts,
and Excluding Populations of 250 Persons or Less,
1991
69
The Forest Iadustry Dependence Index with Transfer
Payment Sector for W Communities, Excluding Populations
of 250 Persons or Less, 1991
Forest Industry Dependence Index With and Without the
T r d e r Payment Sector, F a AU Communities with Populations
of 250 Persons or Less, 1991
Estimation ofIn-kind Income 6rom Traditional Harvest
Swey Data
5.1. Estimation of Volume Harvestad: Waterhen, Saskatchewan, 1992
5.2. Estimation of In-KindValue
5.3. Overview of the Total Economy of Waterhen, Saskatchewan
85
Appendix 5.
90
90
94
98
List of Tables
Table 3.1.1.
Changes in Aboriginal and Non-Aboriginal Population,
Forested Region of the Rairie Ptovinces,1986 and 1991
Table3.3.1.1. F a e s t I n d u s t r y ~ C o m m ~ t i e s , ~ E x c l u d i n g M i a n
Reserves and Rural Disaicts, I986and 1991
Table 332.1. The 1991 Forest Mustry Dependence IndexC
and
Indim Reserves and Rural Districts
m With
Table 4.2.3.1.
The Forest Industry Dependenoe Index W
i
t
h and Without the
Subsistenceand T d e r Payment Sectom: WaterhenReserve,
Sas-an,
1991
Table 3.1.
Faest Indusfq Dependence of Rairie RavinaCommunities,
Excluding Indian Resemes, Rural Districts, and Populations of
250 Persons or Less, 1991
Table 3.2.
Forest Industry Dependenceof Prairie Rovince Communities,
-ding
IndianReserves and Rural Disaicts, aad Excluding
Populationsof 250 Persons or Less, 1991
Table 3.3.
The Forest Industry Dependence Mex with Tm&x Payment
Sector for All Communities,Excluding Populationsof 250
Persons or Less, 1991
Table4.1.
TheForestInduseryDependenceMexWithandWithoutthe
Traasfer Payment Sector, for All Communities with Populations
of 250 Pecsons or Less, 1991
TableS.l.1.
PercentageofEstimatedRespo~~~e~andRespondentsOutof
Total Responses and Respondents, Waterhen, Saskat&wan,
Table 5.1.2.
Ru,poion of Species Harvested and Edible Weights,
Waterhen, Saskatchew~1991
Table 5.2.1.
Average S
Table 5.2.2.
Estimates of Edible Weights and Replacement Vdues,Waterhen,
Saskatchewan, 1991
m Rices, 1991
List of Figures
Figure 5.3.1. Pactntqes of Estimated Income Sources, Waterhen
Saskatchewan, 1991
98
Chapter I D . Introduction
1.1.
Study Problem
The CanadiPngovcmment has been aiticized for its W
e to promote policies
which address the needs of remote and rural resource dependent communities (Fuller
et. ul. 1989. Young 1989). The lacL of regional development policy has engendered a
corresponding concern over the relative absence of baseline data on the location and
number of, and conditions in, remote communities whose economies are heavily
influenced by national and international policies and economic conditions (Fuller et- al.
1989. Young 1989). Of particular concern are communities dependent on narrow
natural resource bases. Such a characteristic increases a community's vulnerability to
exogenous economic impacts, and makes the wlll~~luuity
susceptible to fluctuations in
resource supply (Fletcher 1991). If policy is to address community needs, the location
and the degree of resource dependence of such communities must be know (NLer et.
al. 1989).
Shoe the late 1970s only a small number of studits on resource dependent
commun%ies ir Canada have been produced.
These studies have progressively
contributed to developing an approach to measure and identay economic dependence
upon a natural resource base (Department of Regional Economic Expansion (DREE)
1977 and revised 1979, White et. al. 1986, Pharand 1988, Stcek et. al. 1988, Fletcher
1991). However, C m a d h studies of fortst Qpendcncc havc fPiled to explicitly
address the full nature off-
dependence in Abaigbl communities.
Some researchers (Pharand 1988, Steelc et. aI. 1988) include Indian rcscms
Pnd Ab0righ.L communities without acknowledging existing diffierences in forest
activities and uses, Other studies (DREE 1979, White et. al. 1986) exclude rndian
reserves from forest dependena a n a l . , but do not explicitly state what ktors
warrant this exclusioa Fletcher (1991)excludes Indian reserves &om his calculations
on the basis of cultural differences, and govanmentai di&rences such as treaty rights
to trBllSfer payments.
An important limitation of past measures of forest dependence with respect to
Aboriginal communities are their narrow definition of
"forest dependence".
Previously used measures are based solely on commercial activity such as timber
extraction and production, and related forest industry activities.'
Many Aboriginal
people in forested regions participate in hunting, trapping, and gathering activities?
These forest-based activities contribute, substantially in some communities, to the total
economy of Aboriginal communities.
A fkther limitation of past forest industry dependence measures is the focus on
wage income or employment. The contribution fiom transfier payments to the total
economy is overlooked (Home d Penncr 1992). Dependence on transfkr payment
income is common in many remote communities when cmploymnt is often periodic
or temporary- The economy of many &rigid communities are based on a balance
of wages, transfkrpayments and in-kind income soaras from subsistence activities.
1.2-
Research Objectives and Purpose
The obpCtive of this study is to investigate the utility of incorporating
contributions to the economy from trader payment income and the subsistence sector
into a measure of forest industry dependence. Forest industry dependence measures
typically focus on the inflow of income or empIoyment to a community. Trander
payments function as an inflow of income and, in this study, are included in
calculations of dependence. Idenrifyiag the traosfer payment sector as part of rhe
economic base provides added idormation about the level of economic diversity
within a forest industry dependent wxnmunity.
Theoretical dif)?r_ultiesassociated with including the subsistence economy in
measures of dependence are also identified and discussed. The subsistence economy
affects the flow d a s h income. Also, forest industry sector activities and employment
may a&ct the level of subsistence activity. h light of these d i f b b s , the effixt of
including the subsistence sector on the forest industry dependence measure is
illustrated in a case study using recently coUected data on subsistence activity from the
cormnuaity of Waterhen, Saskatchewan. This analysis r e d some of the problems
associated with using forestry dependeme measures to
dina policy programs and
p r o m in 1 d o m where the effects of such changes m unctear.
This study shows that measuns of fconomic base dependeacc can provide a
general indication of community forest industry dependence associated with inflows of
external cash income (including tr8I1SfceT payments). However, it is also important to
recognize the role of, and interactions of the modern economy with, subsistence
activities m forest, and forest industry, dependent Aboriginal communities.
Acknowledging these Iimitations, dependen- measures can he4 to identify remote
communities with specialized economies where in-depth social science impact research
and analysis are needed i€ the effkcts of planning, policy and market impacts are to be
clearly identihi. This research aiso hishlights the need to continue to search for more
comprehensive indicators af forest dependence.
Chapter 2.0. Literutute Review curd Theoretical Background of Economic Base
Theory
This chapter reviews past studies that pursue the identification of natural
resource dependent communities in Canade. In particular, a study by Fletcher (1991)
is examined that measures dependelzce as a function of the economic base, and
provides a theoretical basis by which to compare forest industry dependent
communities. Economic base theory is then reviewed.
2.1.
Past Studies of Community Resource Dependence
The Canadian government has produced several studies that identay and
measure the degree of resource dependence in rural communities.' In a study by the
Department of Regional Economic Expansion @RE 1977, and revised 1979) the
ratio of employment in a given iadustrial sector to total employment is used as a
measure ofdependence- A community is considered dependent if the ratio exceeds m
arbitrarily chosen minimum. The minimum levels of depeadtltce also vary depending
on the population of communih.
This practice reflects the fact that larger
communities have larger service sectors than smalls communrtrcs. The author
*
r e c b p k s that in remote communitiec the suvice sector is supported mainly by
Fletcher et al. (1991) provide a lhomughreview of Canadian-based studies of rrsoorce d e w .
resource sector exports. Thus, the larger the popdation, the bwer the ratio
(percentage of forest industry ~ I o y m c n out
t of total qbyment) required for a
- community to be musidered dependent,
Using methods similar to DREE's, White et. al. (1986) research forest industry
Qpendent communities in British Cohbia. The authors also measure farest industry
dependence as the proportion of labour force in the forest industry sector to the total
labour force, and a d . t dependence levels according to population size. The authors
adjust for varying degrees of dependence by categorizing c o r n m e with a forest
industry as: spacializad (forestry sector dominates); dud (two prominent -om,
including forestry); diversified (three dominant sectors including forestry); and non-
forest specialized (other dominant sectors, but forestry within the top five sectors). If
the forestry sector is not in the top fivesectors, the community is categorized as minor
or no forest sector.
In 1988 two studies (Pharand, d Steele et. id.) from the Canadhn Forest
Service foIlowed DREE's approach. However, Steelt et. al. do not adjust dependel~cc
levels for varying population sizes. Further,both studies focus only on forest industry
activity, and no additional information is provided percniaing to levels of sectoral
diversification.
Although employment ratios convey some information about individual
c u m m e , there are problems in using this measure for comparisons of dependence
levels between communities of different population sizes (Fletcher 1991). Economic
base theory provides a thcortticd apIanation of thic issue and a fiamework to address
this problem:'
2.2.
Measuring Dependence as a Function of the Economic Base
According to economic base theory a community is dependent upon basic
activity, defined as exogenously determined local economic activity.' All othu local
a c t i . is considered non-basic. Non-basic activity is intemaUy ( l d y ) d e t w
and is assumed to be dependent upon the basic sector. Local economic growth results
from any event that increases the inflow of cash into a region and generates a
multiplier effect of spending and re-spendingin the non-basic sector.
Regional economists recognize there are other factors that can influence local
economic growth besides exogenous demand (Richardson 1985). As the economy and
population of a community increase, intunal factors such as labour productivity,
availability of intermediate inputs, capital and entrepreneurship become more
influential as determixiants of growth (Blair 1991). Therefore, economic-base analysis
Two hiiographic acmoes far hiclariul dmlopmmt daananic bmodels ;m: 1.) Isard, W.
(1960) Methods dReni01181AnaLvsis= An lntrodoctioa to R e a i d Schce. Engkmod CMb, NJ.:
Reatice-Hall k,
and 2.) R i c h a r h . K W. (1985) " I n p t and
~ h a n k Base Multipliers:
hoking B&mrd and Forward"in J
d of Reniaul kkme.25 (4):607-661.
5blydPmulati~dche~nmk._brsm~usllmc&hnparc&bivity~btbesde
d l d sdivity math 1953. Ibwmx, it is m a p b d that there are nhct exogenops
activities that bring mcmey into a local e!canany,such as inhmne r i t 1962). fkbally
and pravincially funded employment (Issennan 1977). and retirement and trader payment incane
(Schwartz 1982, Horn and Penner 1992)-
-t
is CO
to be more
B
appropriate for studits of relatively ma&ma1 communities
viebout 1956, Pletter 1980, Richardson 1985, Blair 1991).
Economic base analysis provides a practical basis for eshatbg dependence on
external income sources in remote c o m x n w . Given the common characteristic of a
relatively high bssic to total employment ratio, remote communiticc are parricularly
dependent upon basic activity that provides income to purchase imports (Fletcher
1991). Generally, multiplier e&cts in rural cammuaities tend to be small, and local
emnomks are characteristicany uadiversified. Remote communities typically f
d to
benefit ftom the multiplier eft-
of basic activity because of income leakage (non-
local spending of income) from the local economy. If, however, the increase in basic
activity is firmifirant and prolonged, multiplier-inducedgrowth of the non-basic sector
willwyaxm.
Using the economic base measure of dependence to compare communities of
di&rent populations avoids the problems associated with the more straightforward
approach of comparing the ratio of industry to total employment. Fletcher (1991)
points out that the ratio of industry to total employment with adjustments for
population size does not reflect the fact that as a community's population increases.
the base to total employment ratio decreases. This occurs because larger communities
are able to provide more swrices because of the advantages aeated from economies
of scale, and kcBQ market demand. As a result, the ratio of non-basicto basic activity
tends to be larger in Iarge communities than in small communitits. If the ratio of
industry to total employment is used, larger commuaities am less likely than small
coarmunities to be consicked dependent. However.given that the non-basic sector is
c~nskkcdto depend upon basic actkity, it m y be k o l l ~ ~ u
toscondude that the
larger community is not dependent,
Another h t o r that a&.x:ts the ratio of nonobasic to basic activity is that some
communitiw are more advantageously located, and thus sene a widu market area
with a greater variety of goods and savioes, then other communities of similar
populatioa6 Such commrrnities' non-basic sectors are larger due to increased basic
sector activity (ie.. the external market k larger for these communities than in
relative1y more remote communities of similar size). Again, as a result of the larger
non-basic sector, such commuaities may not be described as dependent according to
industry to total employment ratios (Fletcher 1991).
Past researchers have recognized the problem of comparing different sized
communities on the basis of the industry to total employment ratio. However, their
arbitrary adjustments lack technical consistency d increase the possibility of error
(Fletcher 1991). Defining dependence using basic activity rather than total activity
provides a theoretically consistent foundation by which to raak and compare
dependent communities. In a study by Fletcher (1991), forest industry dependence is
measured as the proportion that the forestry sector contributes to the total economic
The theay dantrrl places provides a fianmmk fm understanding the hierarchy d communities.
A canmunity that serves a wide market area is b i g k up in the hierarchy becatlse it serves -1
a& uxnmunities. This was fitst d i d by C h r i d k (1966). k t FlLetcher (1991) prcnrides a
brief descripticm t
Sthe theay and the theay's relatimihip to dedhhg d e p e n m on basic s e a r
activity.
base of a community* Thus, variations in the size of the non-basic sector do not
influence: dqendcncc levels of communities of di&.Jent sizes.
Fletcher utilizes the location quotient &Q) measurement to estimate beqe
employment and calculate forest industry depen&llct in the forested region of the
prairie provinces.7 The LQ method is a widely used tool for catcrtlating bask activity
and to ope ratio^ the economic base model (?sserman 1977. Pleeter 1980):
Employment is most commonly used to dctdate the location quotient, although
income, sales, and value added are possible measurement units (Faetcher 1991)P
Thus. an intuitive desa=iption of the LQ is the ratio of a community's share of
employment in industry i to a benchmark region's (ie., the province's) share of
employment in the same industry* The 1ocationquotient can be written as:
where:
qi
and
Ei
E,
= communityj's location quotient for industry i; where i, j = I....n,m.
= community j's employment in industry i
= total employment in communityj
= provincial empIoyment in indusm i
= totalprovincial employment
7Thfaarai@mdtbe~~prmrinasrrc~tedbyamsusaoWivisi~(CS~)withink
fdowing census divisiaas (a)
Alberta
: CD 3, 6, 9, 12-19; Saskatchewan CD 9, 14-18 and
Manitoba CD 1.2.13.14,16-23,
~leeter(1980) mdFkher (1991) p a v i d c r n ~ d d t e m a t h
&&kpes aad in murming
theeccMmicb8se.
EmpIgrmsmt is d ~ m m d rrsd
y
to oprrtianalize the model since anplqtment data is available f
a
studies d a large number t
faxnmtmities. Employmeat data is also relatively inexpeasive to obtain
canpared to the costs d candncting a large-scale stwey- Appendix 1 provides firrther discassim
regarding census emp1ayment data with xespect to cakuiating dependeace.
The benchmark region is assumed to represent the kvel of employment needed
to provide for domestic co~lsumption.A location quotient greater tban one irvltltra
that an industry produces more than what is Deeded for I
d community consumption
(ie., more than the benchmark), and the excess is attributed to basic sector
employment (Isserman 1977, Pkter 1980). Thus, implicit in the calculation is the
assumption that within any given industry per capita consumption and productivity per
employee are identical to the benchmark's consumption and productivity levels
(Isserman 1980, Pleeter 1980). In Fletcher's study, provincial levels of employment
are used as benchmarks. Using provincial benchmarks reduces the likelihood that
within any given industry per capita consumption and productivity per ernplop differ
greatly fiom benchmark levels (Schwan~1982).
Another assumption implicit in the
LQ measure is that neither the community
nor the benchmark region are net exporters or net importers for any industrial
category. Fi, at the cormumity level this is ref&
to as the homogeneous
products assumption (ie., within any industry i, the community and the province
produce identical products), and implies that there is no need to export and import
("cross haul") within an industrial category. However in reality, cross-hauling does
occur. For exatnpk, say a community specializes in wooden cabinet making (at the
three digit, standard industrial category
(SIC)#254). and is a net exporter of this
output. Suppose also that the community is a net importer in products supplied by
both sawmill idustries (SIC Wl), and veneer and plywood industries (SIC #252).
At the two digit SIC d y s i s
(SICm5 - Wood Industries) the wmmuaay's excess
s h a n of clllployment at the cabinet makiag level is UnAutstimated
Since the
composition of products within m SIC tends to imxmsc with aggregation (ie., lower
digit M),the Iocation quotient measure of base employmtnt will more accurately
refkct the homogencous products assumption if highly &aggregated data is used, say
a three or four digit SIC level (Issennan 1977, Schwartz 1982).
Second,at the benchmark level the assumption of no net exports or imports is
what defines the province as "st#-eient" (ie., it consumes exactly what it
produces). Where a province is a net exporter the location quotient overestimates
employment necessary to provide local co~lsumptionat the community level and
community basic employment k underestimated. Where a province is a net importer
~ d ~ l l l t l e basic
t y employment is overestimated (Schwartz
1982).
To adjust for the fact that the province both exports and imports to meet
consumption demands, the provina's share of industry employment is weighted by the
proportion of benchmark output minus net exports (for that industry) out of total
benchmark output (Issennan 1977). This rnodifbhn is used by Fletcher (1991) to
adjust provincial benchmarks to retbct ody that output d e d to meet domestic
consumptioa lo
lo Inputatput tables can be obtained 6r(m Statistics Cauada's catalqpe 7'he National Structure of
COlSOdO. 1990. Ideally. provincial input-t
data. if it wre available at a three digit SIC &add
beusedtb~thisad~t.
The equation f
a the modificationis:
where
E',*
xin
E~~
= the weighted s h a n of employment needed for provincial selfsufficiency in a province when there are no net exports
= totd national output from industry i
= national exports fiom industry i
= national imports fkom industry i
= provincial employment in industq i
Equation 1 can be re-written with the modifications as:
The LQ, as a technique for estimating basic employment has been criticized oa
empirical grou~ds(Greytak 1969. Gibson and Worden 1981). But criticisms were
leveled at studies where high levels of aggregation were used, and benchmark
adjustments (such as the above modification) were not applied. Measurement errors
arise mainly because of assumptions impkit in the L Q technique. Further
improvements to the LQ, generally depend upon improvements in the quality of data
(Bendavid-Val 1991).
Given a positive LQ, the proportion of employment that is devoted to basic
Fletcher calculates forest industry
as the proportion of bese employment
in the forestry sector (which includes timber extraction and manufacturing industries,
and related forestry &,
sa Appeadir 2) to total base employment for each
community. The ratio i s called the faestdependence index (FD1)ll:
where x'jis basic forest industry sector employment and xTj
is the total of all basic
sector employment such that
xTj= z
(6)
i= 1
The FDI is interpreted as the proportion that the forest industry sector
contributes to the economic b m , and provides a means to rank communities by
degree of forestry sector dependence. Fletcher avoids the arbitrary selection of forest
industry dependence categories used in past studies. Instead, -turd separations in the
distriiution of the FDI roughly guided by previously used cut-off levels are used to
describe communities as heavily, modtratdy, or slightly farst industry dependent.
Fletcher's FDI provides a usefbl measure to idtntify, rank and compare
communities whose basic forestry employinent is vulnerable to impacts from changes
in external markets or policy. Fletcher also provides evidence that the higher the FIN,
--
-
-
-
-
-
'' Fletcher (1991) uses th term f
m dependmoe index. b
t ~ O L E Sindusky
~
depenAPnrP.iDdex m m
the measure.
employment is based <m industrial timber exb:actia~and
manufacturhg, and related faestry servIces.
accurately
for any size of forest iudustry depeadent community, the greater the w e h e hnpM
(measured in income) from various shocks within the forest industry. This evidence is
based on a gemra.1equilibrium model, and reinforces the premise that the FDI provides
a priority ranking f
arefmnce in decision making.
Fletcher calculates FDI's for 1981 and 1986 using employment data at a three
digit standard industrial classification (SIC) code. The census subdivision (CSD) is
used as a proxy for 'community'. Although there are 708 census subdivisions in the
prairie provinces. Fletcher omitted 185 Indian reserves and 180 nual districts
(including communitieswith populations of less than 50 persons).L2
Thus. 333 CSD's
were considered in Fletcher's forest industry dependence calculations.
Aborighral forest dependence has been an area of neglect and major
shortwming of the research on forest industry dependent communities in Canada
Where some studies have ignored the contribution of forest-related subsistence activity
to Aboriginal communities altogether. other studies have given the topic only cursory
comment.
Although there are difEic-
associated with including subsistence
activities into economic base measures of dependence (these problem are investigated
in Chapter 4.0), excIudhg Aboriginal communities, or any community, from
dependence calculations results in an under-estimation of the actual number of forest
'
Rnral dW&s is a general rmm far the geographic regicms d: rural municipalities; local
government districts; i m m t distticfs; camties; rural municipalities; and unqnized
suWiviSiotls. Fletcher did not specifir why the remaining 10 CSD's were anitted fian the FDI
Calcalations.
industry dependent c o m m ~ Quantitative
.
evidence of this omisson is provided in
the following chaptertcr
Chapter 3D. Including Indian Reserves, Rural Dim-CIS,and Tran@er Payments in
Ecoru,mmrc
Base Dependence A d y s i s
3.1.
Rationale for the Inclusion of Mian Rcsems, Rural Districts,and the T r d e r
Payment Secta in F a s t krdustry Dependent Calculations
In the forest industry dependence studies reviewed, Pharand (1988) and Steele
(1988) indude Indian reserves and Aboriginal wmmunities in their analysis without
acknowledging cultural differences affecting forest values between Aborighl and
non-Aborigiaal people. Fletcher (1991)excludes Indian reserves fiom CalcuIations of
forest industry dependence due to Aborigjnal people's treaty rights to transfer
payments, and also due to cultural differences. Fletcher also excludes nual districts
from his calculations on the basis that the population of these locales is too widespread
to be considered cohesive communities.
Aboriginal communities and rural districts may be included in economic base
cahhtions of forest industry dependence as long as certain admowIedgments and
adjustments are made. Foremost, economic base forest industry dependence measures
do not address the M nature of forest values d dependence in Aboriginal
cammu*."
Economic base dependence focuses on monetary benefits to a
community's economy, and does not address non-market values of the economy's
participants (Award et. ui. 1992). However,given the rok of the subsistence activities
in providing "in-kind" hrome h many Aborigkl c
o
~ the ~subsistence
,
economy should be evaluated and included in measures of economic base dependence. .
This subject is investigated man fully in Chapter 4.0.
Aboriginal communiriw in the forested regions of the prairie provinces are
sufkiently numrous and hrge that their exclusion from general surveys of economic
base dependence represents a signibnt omission. Most northern prairie province
Indian and Metis commdties are 1ocated in, or near. the boreal forest (National
Aboriginal Forestry Association 1993). The Aboriginal population contributes
considerably to the total population in the forested regions for both 1986 and 1991
(see Table 3.1.1 .). Over the five year period, the Aboriginal population in all three
provinces has increased.
Table 3.1.1. Changes in Aboriginal a d Nan-Aboriainal Population. Forested Region
of the Prairie Pr&ces. 1986 and 1991,
-
Province
Year
Population
Togi
1,096100
Aborigiual
58m
Alberfa
WE
Non-Aborjginal
l,OJ7.300
P.bo~pop.
5.4%
% of moll
%Cllange~kBWl
AborigbaI
ICaslra~hcwan
1991
i,m*a~
nm
1.l2I.136
65%
325%
-
7-
MWoba
1%
1991
I=
n5.m
a
6
4
m
49.225
rnm
41,495
44*681
48m
234,008
US.7S4
la31
183-7'20
U.l%
18.6%
19.6%
2l.W
186%
Non-Aborigiaal
-7.856
8.l%
S m c c Statistics Canada. R d e Series -PartB. Ottawa 1986.1991 GDSUS
dCanrda
1991
2 3 2 ~
92%
02%
bands are uniquely &ned by each culture. and the focns here is oa Abaiginal cultural adaptatim to
the land.
MenyIndieasand~tis(liviagbothondoffnsaves)areemployedbythe
forestry industry. IdentayinS timbu dependent Aboriginal c o r n m e can inAirnte
. ..
where industrial forestry sector a&w&s support or compete with the bush hvvest
eco~oIll~.=~
Rural districts may also be included in surveys of economic base dependence.
These census subdivisior~~
(CSD's)may vary in size (population and area), and nature
of economic development. However, in some cases nvsl districts may be more
economically developed and politicany organized than neighboring towns. Regardless
of the geographical spread of the population, excludining these CSD's excludes a large
part of the employed population.
Ideally, in terms of policy and management
decisions,all potentially affected farest industry dependent CSD's should be identified
An important adjustment to the economic base forest industry dependence
measure is the hclusion of income &om t r d e r payments. For this study, traasfer
payments are broadly defined as my source of income other than employment income,
such as pensions, unemployment income. investment income, et& Calculations of the
economic base which exclude transfer payments ignore individuals who receive
external flows of funds as a sole source of income (Schwartz 1982). Omitting t r d e r
payments tends to overestimate the contribution to the economic base from
employment sectors. Tram& payments provide an important source of income to
many Aborigiaal and non-&rigid
communities, d should be included in the
-
lkkence to the bush harvest a m a n y includes rnactivities (fadameaic cummpticm).
and other bush activities such as commercialtrapping. fishinp. and sales of traditid 8rts and crafts.
l4
measure of economic base dependence for 1cornmunitits. The following section
provides an explanation of how the tram&
payment data fix the forested region of the
prairie provinces is obtained and included in the LQ and depeadcnce measures.
3.2.
Tnnsfer Payment Data
Based on census categories, the number of people who rely solely on traasfer
benefit income is estimated by subtracting the number of people who collect
employment inwme from the number of persons who collect income. Statistics
Canada provides a count of the total number of people, 15 years and oIder, who
receive iacome." Statistics Canada also categorizes and counts the number of people
who collect employment income.'6 Data for the calculation of the transfer payment
sector was obtained ftom the 1991 census. Traasfer payment data is availabk for
communities with populations of 250 persons and up. Statisth Canada suppresses
income data in smaller communities to ensure coafidmtiality.
L S S ~ ~ ~ ~ ~ ~ i n a m e : ~ ~ d s l l m k s ~ i D o o m s 6 r a n ~ a t e d
fann buskess andlot p d b i a a l practioe; net farm selfcmploymeat iacome; d d age seanity
pensidn and Guaranteed Inrrme Suppfeaue~t;bene&s fiOm Cmdl a QOebsc Peasim Plan; family
allwmczs; fkkal child tax credits bene6ts h n manplaymeat insurance; other inane &an
gavernmeat saxrces; investment inntiremeat peashs. srrpaanndcm and annuities; and
other mawy income cash iaorme rewived and not repded uuder the sances listed (Statistics
rannda Cat, no. 95-366).
-
' 6 ~ p l o g m e n t ~ i s d e f k d awrgamdsrlnics;net~6rantmin~~~~lltedncm-farm
s:
bnsiness ma/ar prodessid practice; and net farm selfcmplaymeot incane (Statistics Canada Cat.
no-95-366).
In this study, transfer payment cllculptions are based on the number of people
receiving tram& income. The probkm with this approach is that there is a wide
variability in the amount ofhcome received from di&rent types of traasfa payments.
Similarly, using tr-
payment recipients implies tbat the income &om transfer
payments does not greatly di&r&om the income received for wage emp1oyment. This
does not accurately reflect the fact that income received from transfer payments differs
in amount depending on its source." Pensions and unemployment insurance payments
are typically less than income received 6rom previous employment. Income as a unit of
measurement, instead of number of persons receiving transfii income, would more
accurately capture the differences in income between wage and transfer payment
sectors. However, for the sake of comparison to Fletcher's (1991) study that uses
employment data, the number of transfix payment recipients is used here.
Once the number of transfer payment recipients is obtained for the CSD's it is
included as a sector, similar to the employment sectors listed in Appendix 2. The
share of transfer payment recipients in the CSD is compared to the share of t r d e r
payment recipients in the province, as per the LQ measure. If the LQ is positive, then
basic tr811Sfer payment activity i s calculated.
"Disein%uishingthcv.riatrolnrdahromeu~~armldbccOr~cbc~amdtr~
paymeat dependeaoe. Fa example. if dependePoc oa pensian incane is prednminlrnt, this defms a
quite difberent d~mmunitythan ane that is depeadent cm unemplqrment insnrance incame. Deriving a
dependwrce measure that &mc&rhs this diffp a n t s a topic for future research,
3.3.
Results
The following sections provide a sumrmuy of the results &om three separate
calculations of the FDI for forest industry dependent communities of the prairie
proviaces. FItSt,the FDl is updated using 1991 data, and Fletcher's definition of
community (ie., excludes Indian R e e m s and rural districts). The results are
compared to Fletcher's 1986 FDI results. Second, the 1991 FDI results (and narrow
definition of community) are compared to a recalculated FDI that expands the
definition of community to include Indian resemes and rural districts. Last, the FDI
(withthe broader definition of community) is compared to a recalculated FDI (again
with the broad definition of community) that includes the transfer payment sector.
3.3.1. Forest Industry Dependent Communities, Excluding Indian Reserves, Rural
Districts,and Transfer Payments, 1986 and 1991
Employment data at the three digit SIC for 683 census subdivisions in the
forested region of the prairie provinces was obtained from Statistics Canada." Of the
CSD's there are 183 Indian reserves and 169 rural districts. There are twenty-one
CSD's with populations less than 250 that are excluded from the 1991 ml1 raults.19
Thus there are 310 6'communitits"as d&md by Fletcher (1991). The total number of
''
Tlme digit SIC emplaymeat data is available by special ader f b n Statistics Canada. The data
ordemi for this study is based an the 1991&nsus of Canada.
19
ummztcy with available tr&
payment data. and f
a the pmpose aE cunpatisoa,
populatials clE &ss than 250 persons are excluded fian all 1991 FDI cslolraticms, as well as hxn
Fletcher's 1986 FDf results.
-
forest industry dependent comunitics (and totaL popuhdon) for categories of heavy,
moderate and slight dependence by proviuce are listed bcbw m Table 3.3.1.1. A fun
list of forest industry dependent conrmunities for the 1991 celculation is provided in
Appendix 3, Table 3.1.
Categories of heavy, moderate and slight forest idustry
dependence are designated based on natural breaks identitied in the 1991 FDI results
(the largest di&rentials between FDI's), and guided by cut-off levels used in other
studies.m
Table 3-3.1.1. Forest Industry Deoendent Communities. Excludinp Indian Reserves
and Rural Districts. 1986 and 1991
I
Province
Alberla
1
number.of
.
co~umnihes
0
I
W
population
I
1
--99
-1
-
namber- of
-
C
O
~
S
population
Heavy hest industry dependence
-
I
1
MaDitoba
1
724
2
~ogl
2
2851
4
6302
W e r a t e forest industry
- de~endence
-
b
AIbem
8
a=
Sadcachewan
1
1
8W
8
2
9
m
5
2957
Manitoba
6,283
2
8s)
Tad
10
57.722
15
44755
Slightfarestiodpsay dependence
11
Alberta
97.751
a041
11
Saskaehewan
44,888
9
42577
3
Mhhba
5
14.91s
1Qm
25
Total
87.767
42
lS533
*Saw;e:F
i(1991) and fapopulatioo numbers 1986 Census (Statistics ClnnarlrL
In all three categories of dependence, the number of forest industry dependent
communities ~ C ' S )and
, their associated populations, have increased. Much of the
h q a s c can be attributed to a Iarge number of new FDC's in Alkrto.
The Alkrtll
g o w n t ' s policy has focused on development of the forestry industry since the
early 1980's. Between 1986and 1989 four new pulp miILp began operations in Alberta
(in addition to tbe singk existing pulp mill). The rise in forest clctivity has iarrrased
the total number of m)(3's
(in all categories) in Alberta &om nineteen in 1986 to
thirty-sevenin 1991.
In Saskatchewan,two new mius came into operation (a paper d in 1990,and
a pulpmill in 1991)over the fiveyears between census surveys. Activity did increase
in the area of the two pulp mills causing eight new communities to be considered
forest industry dependent. But the total number of FDC's did not increase greatly
(from thirteen in 1986 to e
n in 1991) in the province because six c o m m w
previously considered slightly forest industry dependent feIl &omthe ranks. Of the six
communities that fell @omthe dependence ranking, most communitiw had only a smaIl
percentage d persons employed in bask forest industry activity in 1986.
Manitoba has nine FDC's in 1991. compared to five in 1986. MPnitoba's
comxnunirits reflect a similar situation to Saskatchewan, with two pulp mias
dominating two general areas. Both mias were established before 1986. Since, four
sawmiU-plrvring complexes began operations (Giles a d Bohning 1992). Menitoba's
forest products exports increased in 1986 and r e d fPkly stable until 1989 (Canadian
Forest Service 1992). These &tors have contributed to anincrease in the number of
FDC's in the area near the mills.
3.3.2. Fmst Industry Dependent Communities, hcluding Inclian Resems and Rural
Distticfs, 1991
Thae arc 613 census mMivisions (CSD's) in the prairie provinces whm
Lndiaa resems and d districts are inchded in the analysis: 134 enumerated
reserves, plus 479 CSD's (49 reserves were omitted because they were not
enumerated). Table 3.3.2.1 below, compares the 1991 forest industry dependence
index (FDI) calculation, which exclude Indian resefves aed ma1 districts, to the 1991
FDI &tion
that includes all CSD'S"
(refer to Appendix 3, Table 3.2 for a full list
forest industry dependent CSD's).
Table 3-3.2.1. The 1991 FDI Calculated With and Without Indian Reserves and
Rural Districts
I
Mmibba
Togl
Albertr
Sadcachewan
Maaabba
Tow
I
I
1991
I
FDI excluding ~odiaa
reserves & d d j s k k t s
I
-
2
" RecaJl firom f
maze.
lam
4
8
5
2
15
28
Maniooba
Total
69I#
5
42
1991
FDI i~~hding
~nciiaa
reserves & nrraldisaicts
-
5
9
1
I
I
19,049
532x1
la=
l4.m
8L118
.
.
Slight forestindustry depcadeace
97'751
39
154.275
L49U
21
81
26%pg
15633
I
4752
Werate forestiadasay dependence
l5
9
2957
8
8520
47%
1
585%
m 19 that FDI calarlaticms iaclrde CSD's with poorrlaticms d 250 pecscms a
W
i
t
h the inclusion of Indian resenns and m a 1 districts, nine CSD's are
considered heavily forest industry depmdent- The aear doubling of the number of
heavily FDC's equates to an 82 pacent incresse in the populntion of those
communities.
Table 3.3.2.1. shows e
n moderately FDC's as d c h & by Fletcher,
compared to thirty-two CSD's when I d a n resefves and nxrd districts are included.
Both the number of moderately FDC's and moderately dependent population ahnost
double. Of the seventeen communities previously exchded fkom the moderately
dependent category seven are Abo-
a m m e . Aboriginal commllnities make
up about 3.4 percent of the total population in the moderately forest industry
dependent group?
Only 57.8 percent of the population in the slightly dependent communities is
accounted for when Idkin reserves and rural districts are excluded. Including all
CSD's boosts the slightly dependent population to 268, 596, end the total number of
slightly FDC's to eighty-one. Of these, e v e n CSD's are Aborigkd communities: five
fkom Manitoba, six in Saskatchewan, and one Alkrra reserve. The eleven Aboriginal
communities account for 3.2 percent of the total s w t l y forest industry dependent
population.
"
This calcnlrdm d a s not accamt for Abmigid people living in ammtmities nat identified as
Aboriginal communities. Mime Abaiginal cunmuaities with populaticms between 50 and 250
persons were calculated to be f m t industry dependent, but were omittedfroln tbe calcalations
industry dependence studies. The total number of FDC's (indl categories) doubks
with the inclusion of Indian mcrvcs and rural districts. The total fonst industry
dependent population inaekscs by 78.4 pacent. Including all CSD's provides a more
complete spatial analysis of the forested region's population. This more iachsive
definition of community identifies areas of forest industry dependence that are missed
by the narrower definition of community. Many Indian reserves and rural districts are
located on or near the periphery of communities with established timber industry
operations. Some more distant CSD's are supported by smalIer operations or logging
contracts. The point of including all CSD's is that the effds of shocks to the forest
industry products sector are more widespread than identifxd by a more exclusive
definition of community,such as the one used by Fletcher (1991).
3.3.3. Forest Industry Dependent Commdtiies. Including Indian Reserves, Rural
Districts,and the T r d e r Payment Sector, 1991
In every community considered in this study,
there are some individuals
receiving some form of transfer income. Evidence of this is shown in the increase in
total basic activity in all communaks with the incIusioa of transfkr payments. as shown
in Appendk 3, Table 3.3. The increase in the total basic activity causes forestry, and
all other basic sectors. to make up a smaller proportion of total basic activity. As a
result all FDI's fall, and the total number of FDC's also falls. The last data set.
presented in Table 3.3.3.1. below, shows the nsulto of c a h h i n g the FDI (all CSD's
of popuhbns of 250 persons and greater included) with and without a trensfer
payment sector.
Table 3.3.3.1- The Forest Industrv Dependence Index Calculated With and
I
Alberta
Saskarchewan
Mimitoba
Total
Alberta
Saska~hewan
MgniQba
.
1
3
5
9
15
9
8
4.a
39
0
2169
6166
8335
9
16(332
4752
W,W
I
Werate fbrest industry dependence
10
53,233
5
w
Togl
Alberta
0
2
1
3
I
14~1
8lJ8
Swtforestindustry dependence
154.275
I
34
I
I
4018
68912
1-1
In the heavy forest industry dependent category the number of communities
falls &om nine to three CSD's. The drop in communities equates to about a 56
percent drop in forest industry dependent population in this category. The remaining
six CSD's fall from heavy dependence to tbe moderately forest industry dependent
"
Agqmdix 4 provides a List d the FDrs far all canmunititscakuhed withaat and with the aanskr
b d s sedclr.
In the moderate forest industry dependence category the number of
corn-
also falL. The drop in population in this category k 15.1 percent. In the
slight forestry dependence category there is the k t chrqge in both number of
communities and population.
The munba of mlishtly fbrest industry &pendent
communities fails by nine, and population decnases by 13 pacent. In total twentythree communitiesfell fiom the forest industry dependcna categories altogether.
Communities with a large proportion of basic transtir income recipients out of
the total economic base are actually less dependent on basic forest industry
employment than implied by FDI calculations that exclude the t r d e r payment sector.
The traasfer payment sector helps to diversify the economic base of wmmeties. For
some communities, the economic base is made up of a single basic resource sector and
a transfa payment sector. If the resource sector is affectad by a negative shock,
dependence on the tr80Sfer payment sector, the only other external income source,
would increase. There are serious implications for such commuaities should negative
shocks to the tranrfer payment sector occur as a result of policy decisions. The effects
of the new Employment Insurance Program (as of June 1996) on changes in
dependence in FDC's presents a topic far further research.
Including the tramfix payment sector in deptndcllct cakulations provides a
more complete profile of the economic base of communities potendally affected by a
change in the fanst industry products markets,timber supply and forest policy. This
too couki be improved in hturt rrscrrrch &om, by
Born investment and -on
incame.
Owall, omitting h d h reserves Md ~
industry
~
W
~~social asJLnaDce
adistricts
l
&om dcdatior~~
of forest
undcrcsthmtes
X
the number of FIX'S in the prairie pro*
regioa However,including Indiannsemsand nualdistricts but omitting the t r a d k
payment sector tends to overestimate the degree of forest industry dependence, and
hence the number of forest industry dependent communities. A more accurate listing
of the number of forest industry dependent commurlities is generated from the FDI if
all communities and tr8I1Sfer payments are included.
However, Aboriginal
communities' dependence on the subsistence economy remains an issue. and if omitted
fiom the analysis represents an underestimate of forest-related activity and
dependence.
Chapter 4.0. Defning Subsistence According to Economic Base Theory:
Implicarinsfor Forest Policy
Wbenas the inclusion of the trrasfa payamt sector mto the FDI is reasonably
straighdomard, adapting the economic base dependence measure to include the
subsistence economy presents more of a challenge. Important theoretical issues
regarding how subsistence is to be defined, in turns of non-basic and basic sector
activities, need to be examined if the subsistence economy is to be included into an
economic base measure of dependence.
The economic base method of measuring basic and non-basic activity focuses
on the income or activity &om market exchanges of locally produced goods and
services that accrue to local residents (Schwartz 1982, Blair 1991).
However,
calculMions of a community's economic base that use total income (or equivalent
proxies such as employment) do not capture the non-market transactions associated
with non-market production. As a result, the contribution of subsistence production in
raising the total value of production within a community is ignored.
The value of subsistence contributions to the total economy urn be quantified
in tenas of in-kind income, and included as part of the community's total income. By
including subsistence, the community's income is raised above estimates b e d on
measures of cash income alone. The question of interest here is: can subsistence be
defined according to the basic/non-bask sector Crituia end included in economic base
measures of dependence? This is important since many Aborigid communities
depend on the forest for the iaco~lltin-kind contribution &om the subsistence
econcnny*
4.1.
The hportance of the Subsistence Economy in Alxcigid Communities in the
Northern Prairie Provinces
In the 1960's and 1970's. research focused on the we-
of Aborigbl
residents living on reserves in the prairie provinces. Reports were concerned with
wage income and employment. In a study on the quality of life in native communities
in the Caaadian provinces, RBel er. 01. (1972) assert that traasfer payments held
residents captive in otherwise uneconomic conditions. However, no rebence is made
to the attainment of in-kind income &omsubsistence activities. Nor do the authors
mention any possible cultural or social prekence to live in a location where
subsistence can be practiced and has been practiced for generations. Of the early
research that documents the bush economy in northern Saskatchewan, subsistence
activities are limited to commercial trapping and fishing (Buckley 1962). and
subsistence for domc&c consumption is not considered.
In the latter part of the 197O's, research began to focus on domestic
consumption and dependellce on subsistence harvest. Much of this research was
udertakn in response to non-1d iadusoies' proposals to develop northern
resources, and the possi'ble c o d k t over lead use. Several such studies focused on the
impact &om: the Jamas Bay Hydro Ekctrk development in northern Quebec (James
Bay and Northern QuebecNative Harvesting Research Conrmine+ 1982); the hydroelectric insullation at Wintego Rapids on the Churchill river in nonherstcrn
Saskatchewan and northwestern Manitoba (Mitchell 1975, Ballantyne et. al- 1976,
SchindcIka 1978); uranium development in north-central Saskatchewan (Institute of
Northern Studies 1978); and socio-economic effkcts of resource development on
native communities in westem Canada (Waidrm 1988). These studies report an
active subsistence economy in many Aboriginal communities.
More recent research has been initiated by Indian and M&
peoples in
conjunction with traditional land claims, or to avoid conflicting land and resource
management issues. These recent studies apply more rigorous methods to assess
subsistence activity of native inhabitants of Alberta (Wein et. al. 1991)~,
Saskatchewan (Tobias and Kay 1992). Manitoba (Northern Manitoba Economic
Development Commission 1992). and Ontario (Berkes et. al. 1994).
Recently, traditional hamst survey (THS) data was c o k t e d for 1992 b e s t
rates for Fit Nations cornmudies in Saskatchewan in response to co-management
initiatives between Mistik Management Ltd and the M d o w LaLe Tribal counciLS
For the purpose of reddating the ED1 to include subsistence activity, the THS data
"
W e b et. a2. (1991) &mates indivimul faxi amsumptim dcamtry f& and od naas eshate
an in-kind value. Emphnsis is on nutritimal, ratber tbaa maaetary, value of subsistenceproducts.
'5 Mistik Mmgemmt L(d is a private. naa-pabit firm CespdOsiMe fm timber mamgeamt d
NmSask's Farest Management Licensing Agreemew
i s used to estimate in-kind income f
aan Abariginolcommunity in
aska at chew an?
are obtained by imputing prices using the closest substitutes to harvest products that
are available in the nearest market (Usher 1976, QuisIey aad UcBrIdt 1987, Berkes
.
et- al. 1994). Using this approach, in-kind income is -timatad to be about one quarter
of the 1991 total community economy of Waterhen, Saskatchewan. This amounts to
approximately $4. 450 per household. This is a sizable contni'bution in a community
where average household income (based on wage and traosfer payment income and
excluding in-kind income) is estimated to be $13. 184 (Statistics C m d a 1993b). This
amount lies witbin the range of other studies' calculations of in-kind income. Tobias
and Kay (1992) estimate average annual (1983/84) in-kiud income in Pinehouse,
Saskatchewan to be $5, 710 per household Bukes et. ul.(1994) estimate average
annual (1989190) household in-kiud income to be $8,400for eight cornmunitks in the
Hudson and James Bay Lowland_ Ontario. In Northern Manitoba, a regional, annual
(1983/84), estimate was $1,167 per household (Wagner 1985).
Studies of remote corn-
in the more northem prairie provinces
recognize that available wage income alone (usually h m resource industries) provides
for marginal E
.where distance raises the cost of living @one and Green 1986).
The contribution of the yearly subsistence hamst to the local economy partly enables
continued residence in remote resource-based regions where employment tends to be
26 Appendix 5 provides the method used to calculate an estimrte din-kind incane. and Sectim 423.
is an evaluation of the FDI with the subsistencesector included.
impennanmt. The coexistence of the wage and subsistence economy has been
identitid as vital in sustainingAborigid communaLs (George 1989, Tobias and Kay
1992, Bcrkes et. uf. 1994).
4.2.
Theocctical and Policy Considerations for the Fanst Industry Dependence
Index of Including the Subsistence Economy
The theory of the economic
base focuses on the
flow of income (or
employment) between a community and its trading partners, and how the community is
affected by changes in this flow. At the community level, the economic base concept
of total community income is similar to disposable income as defined in the national
accounting system (Schwartz 1982). h o m e is calculated as the payment to resident
factors of local production and trensfk payments from bath public and private sectors
minus personal taxes and other transfkrs to the government (Schwara 1982).
Subsistence products are generally not traded in markets, and therefore are not
captured by measures of income flows. If subsistence output was translated to in-kind
income meewes and included in community income accounts, the equilibrium level of
community income would k higher than when based on the kvel of cash income
alone,
Economic base theory accounts for flows of income as either inflows of
income &om e x t d sources (basic activity), or as local income flows (non-basic
activity). To include subsistenx activity requirts aliocating in-kind income into the
aon-basic and/or the basic sector; tbis is discussed in the mxt section. To whichever
sector subsistence activities are akmted, the assumptions regardjag the relationship
between the basic and non-basic sectors must hold with the inclusion of subsistence
activity. Specifi#lly, noebasic activity depends upon the basic activity, such that an
in basic employment leads to an h m s c (decrease) in non-basic
increase (or d-)
employment. The effits on this relationship are investigated when subsistence is
considered to be part of the non-basic sector (Section 4.2.1), or as part of the basic
sector (Section 4.2.2).
4.2.1. Subsistence Activities as Non-basic Activities
There
assume that
are characteristics of subsistence activities that would lead one to
d subsistence activity should be aIlocated to the non-basic sector.
Subsistence is defmed as activity that produces output solely for domestic
consumption. There are no f o r d , external markets, or export of subsistence
products. Since there are no expons of subsistence goods, it could be assumed that
there is no basic subsistence activity. However, there may be problems with assuming
that subsistence activities belong to the non-basic sector.
The addition of subsistence to the non-basic sector implies that subsistence
sector activity depends on the basic sector to occur. This means that as the basic
sector increases (or decreases), the multiplier e k t s on the non-basic sector activities
(inchding subsistence activities) are direct, and therefore increase (or decrease) along
withthec~inthebksicsector. Themaincriticismofthisargumentisthatthe
relationship between the basic sector and subsistence (as non-besic activity) is not
known. Thus, the strictly direct basic)hon-baskrelationship as suggested by economic
base theory does not hold when subsistence activity is included as 11011-basicactivity.
For example, an increase in basic forestry employment directly causes a &st
round of increased employment and hwme in the short rua
The increase in
employment and income in the comrnunhy may have a positive and/or negative
influence on %on-basic" subsistence activity- An increase in income may have a direct
effect as suggested by economic base theory. More income may result in an increase
in the number of subsistence harvesters. Inputs to modern subsistence production are
typically obtained through cash purchases, and otherwise williug participants can be
constrained by a lack of funds to cover harvesting costs. An increase in wage
employment enables those who previously could not afford to go out on the land, to
participate in hanresting activities. Several studies r e d that in communities where
subsistence is practiced, increases in wage employment has not led to a decrease in
harvest activity, and in some cases the number of hamst participants increased
(Condon er. al. 1995. George et. d.1995). It is l o possible that an increase in wage
income may go towards upkeep or replacement of hamst equipment (ic,new
snowmobiles, trucks, boats or other harvesting equipment) for those already engaged
in subsistence production. Active hamst involvement is dependent upon the cash for
repairs to maintain reliable equipment and supplies (George et. al. 1995. C d o n et-
aL 1995). A hunter might be (igr~uded"
if a lack of fiuds restricts equipment repairs
(Condon er- ul. 1995).
It is possible that an insectors that remains uae@aincd
relationship exists betwan the bgsiclnon-bask
by ccouomic base theory. Emplcyment may reduce
the time available for participation in subsistence activity.
There were several
individual responses to the traditional harvest survey (THS) in Saskatchewan
(Appendix 5) who responded that working fbE-time left no time to engage in seasonal
subsistence practices. However, some studies suggest that although the number of
people participating in subsistence may decrease as a result of increased employment,
the harvest quantity may not. Harvest quantities may remain stable as tasks and funds
became reallocated, to intensiry the effort of those remaining in harvest production
(Wolfe 1987. Elias 1991, Tobias and Kay 1992).
It is also possible that an increase in basic employment (and income) may
support a preference to purchase store-bought harvest substitutes, and possibly reduce
the demand for subsistence products, and the need to partkipate in harvest activities.
There is some evidence that the younger generation exhibits a temporary dietary
prefuemx choice for 'cconvenicncefoods"; however this does not accurately reflect
preferences far the entire population (Wein 1989, Cordon et. al. 1995).
An increase in basic sector employment will negatively a&ct the ability to
engage in subsistence activities if o w the long-term it rrsults ia a decrease or loss in
the skills and elrpuience related to subsisterme harvesting. If If skills aeaded for
..
participation in the subsistence economy an reduced, the diveradyrng influence of the
subsistence sector on the local economy will also be diminffhsd.
Further,a permanent
ckrmsc or the demise of the subsistence sector may be interpreted as a loss of
traditional culture, and as such will have negative implications for the social well-being
of the community @liaP 1991, Condon et. ui. 1995).
Generally, the effkcts of wage employment on community subsistence
participation cannot be predicted by the direct relationship betwem basic to non-basic
activities in the economic base modeL Although there is some relationship between
harvest activities and the cash economy, it is not fully capnuad by allocating
subsistence to the non-basic sector. It is difficult to estimate the extent that
subsistence activity relks on inflows of external income (for example, to meet
production costs of subsistence activity). The effiscts of wage employment on the
budget and time constraints of, and prefkrences related to, subsistence activity present
empirical questions for fi;lrther research.
Perhaps most importantly, allocating subsiste~lceto the noa-basic sector Lads
to the impW assumption that a communiry would never be considered dependent
- ..
upon forest-related subsistence actnntres. This incongruous result does not aptly
describe communities where subsistence contributes sienifiurnt in-kind income to the
total income 8ccbunts of the economy (as discussed in Section 4.2). Nor does it
describe how the subsistence economy works to diversify the local economy by
providing an alternative or supportive means of incame when jobs are scarce or
limited. Owall, it seems inappropriate to define subsistence a&&y
as non-besic
activity. Subsistence rtivity as basic sector actkity is uElrmined in the following
section*
4.2.2. Subsistence Activities as Basic Activities
Subsistence activity does not fit the general definition of basic activity either;
subsistence does not create an Wow of cash income fiom external sources since is it
not motivated by external demand. However, under certain conditions, subsistence
production fimctions similarly to import substitution2', and can increase the local
rnultipkr (as assodated with a change in basic activity) by decreasing income leakage
&om the community. The circumstances required for subsistence activity to increase
the l
d multiplier is first, that subsistence harvest output replaces food products that
are non-local (ie., imported) purchases. Thus, subsistenceproduction provides goods
that must othemise be imported. Also, subsistence production enables co~lsumersto
spend their income on a wider variety of non-food goods (incomeotherwise spent on
food purchases). This leads to the second condition that these additional non-food
goods sre purchased locally. Combined these two conciitiom will lead to an increase
nSabaiamoc~tyispat*llymotiv;lliedbgtbc&tiveiy~apdpaebaughtalteroatives
a
c
m
e and Green 1986. Wein el. a1, 1991). as well as fm the
fa locally harvested bosh
foods (Wein e!. al. 1991. Cmdm et. al. 1995). These factclrs provide an impetas far impart
substitutionto OCCUT (BIair 1991).
in the local muttipiiu by tau* a rePlbcMion of cash e x p d h e s from non-locai to
local,
Such conditions do not desaibe the dcircumstances in remote Aboriginal
communities. Subsistence lctivity replaas a proportion of expenditure that might
otherwise go to the locPl grocery store, an economic activity that is perms
reasonably common among small towns. Also, given the typically hited variety of
goods and seNices in remote communitiec it is likely the non-food purchases are made
outside the community (Berry and Pam 1988).
This combination of firctors,
subsistence activity replacing a local service and a redocation of expenditures from
local to non-local, results in an h m e leakage from the wmmunity that dampens
local multiplier effeas?
The possibility that
subsistee production functions to increase the local
multiplier is not enough evidence to support the assignment of subsistence activity to
the basic sector. Perhaps the most s i p i f h n t theoretical argument for excluding
subsistence from the basic sector is that subsistence production does not produce an
inflow of cash, even though it increases the total amount of income from all sources
(including in-ltind aad cash income) in the community. Rather, subsistence production
tends to a&ct how inflows of cash income an distributed. Understanding how
Other possible ambinati4~1~
are: sllbsigamcr ceplroh I
d 6md pu&119es md alternative
expeaditures are also I d ; and subsistence replaces n a a - 1 d f d pmchases and alternative
expMditmes are alsonon-1ocaI. In bath these cases the Local multiplier is d P l l t e r l
subsistence activiry aff&ts local and non-bcal expenditures is a topic worthy of
furthertestarch.
Given the dh&@g
innuence of the subsistence scctor on the bcrl economy
it would be usdul to inch& it in meconomic measure of dependence. Restricting the
economic base dependence measure to a desaiptive anal@ allows the incIusion of
subsistence activity, a d provides a more realistic analysis of the potentid diversity of
the economic base. Howmr, given that subsistence sector does not accurately fit the
d e m o n of basic activity, it is &own
whether the economic base dependence
measure (with subsistence included) wouM still provide a method of ranking the
welfare effects of economic shocks to communities. The following analysis of the FDI
with subsistence included should be interpreted in light of these uncertainties.
4.2.3.
The Fonsr Dependence Index Calculated to Include the Subsistence Sector as
Basic Activity: A Case Study in Waterhen, Saskatchewan
In this section, subsistence activity will be treated as basic activity and included
in the dependence measut. Detailed, subsistence harvesting data is rare at the
community kveL Thercfort, FDI calculations including thc subsistence sector for all
Aboriginal wmmunitics in the prairie provinces is not possible. However, mest data
was avnrlahk in Waterhen SK,and permission to use this data was obtaiaed from the
Waterhen First Nation. Including the subgistencc sector when celculathg dependeace
is similer to the approach used to indude the traasfa payment sector. Given that the
FDI calculation deals with c m p l o ~ nnumbers,
t
it is occessclry to express subsistence
activity in terms of pasons.
One approach to duiving an employment eq@valent to subsistence aaivity is
to add up the hours spent hemsting, weight the total hours by the percentage of full
and part time employed, and divide by full and part-time hours to arrive at number of
full and part-time persons. According to census estimates, thae are approximately
30.5 percent full time, and 695 percent part-time persons. out of total employed
persons. Based on THS responses 9,418 days were spent on the l d over the year.
This number was calculated by assigning awage values of time spent to respondents
that indicated harvesting iuvolvement but did not indicate time spent. There are 260
and 130 working days associatedwith full and part time work respectively.
5.305) (94182
= 11.05 (xnxmber af persons working full-time)
260
C.695) (9418)
130
= 5035 (number of perscms wo-
part-time)
The estimate of number employed based on the THS estimates of time spent on the
land is e q d to 61 persons.
A problem associated with this calculation is that the harvest surveys provided
datapert&ingtotimcspenthamstiagona perspeciesbssi9,andas aresult,doubk
counting is a problem. Double counting occurs because m y people report beiug
engaged in more than one hamstiqg activity wfiile out on the land. Future sumy
instruments should be structured to avoid double countiug, so tbat estknatcs of time
spent harvesting could produce marc uscN results.
Because of the potential doubhunting problem, the chosen altlrnative is to
calculate the number of employed persons it would take to produce a wage income
equivalent to the estimated vahe of in-kind income. This can be interpreted as an
imputed number of employed associated with the subsistence sector, given that the
number of persons reqpired to harvest a given volume is not readily known.
In-kiad inwrne is divided by a weighted average of Ma d part time income
per employee to arrive at the number of subsistence participants. The weighted
average of full and part time income per male and female employee equals $1 1.828.10
l
for
(Statistics Canada 1993b). The calculation of weighted average a ~ u a income
part and full time employment for Waterhen. S K is as follows:
Nmber of part timepetsoas:
=46
fimaks =27
Number offull time persoas'.
=9
fkmales =23
des
males
Average full time iacOme:
males =S15,624
h u k s = $16.751
Average fidI time income:
males =$7.214
k m k s = $7.236
Weighted average m.le and f;iemale part time
S7,214(0.6301)
+ S7,236(0.369!0 = $7.222.16
Average of weighted fall audpart time incane per emplayed pestm
(S16.434.03 + $7.222.16) / 2 = S11.828.10
To derive the number of wage-employed individuals l s s a r y
to produce
income aqui.Valent to the estimated value of the subsistence &mest,in-kind income
($672, 36593 refer to Appendix 5) is divided by the weighed average of annual
income per employed person for Waterhen, S K The calculation is:
~kiPdincanedividedbyweig&ted~afipcome:
$672,36593
2:
57 persons
SL1.828.10
The resulting number of persons associated with subsiste~~~e
activity equals 57
persons*
To calculate dependence, the imputed number of subsistence participants m
Waterhen, S K is aggregated with basic employment ard basic trMer payment
recipients, to arrive at total basic activity." Basic sector dependence is calculated the
same
as the FDI as the ratio of sector activity out of total e c t i . . Several FDI
measures fa Waterhen, SK.are computed and listed in Table 4.23.1.
Table 4.2.3.1. FDI With and Without the Subsistence and Transfer
t Sectors Included: Waterhen Reserve, S a s k a t c h c ~
m
I
0.1981
I
0.083
I
0.0648
I
FDk forest industry dependence index excluding transferpaymeat and snbsisteoce sectas
h b k cclrmting is a problem when a g p g a h g suhristena partkipatiotl with emplaymeat and
r d payment recipients. Statistics Canada's employment numbers do na accamt fm multiple
pbs. Individuals engaged in sumay also be employ& or c d k t t r a d k payment incane.
Thus the FDI results in Table 42.3. are not canparable to other FDI cahhtims A more -ate
mesfltre~basicac~'vity&~wdd~formultipk~of~.
29
t
Where just wage employment is cooOn~edin the first 0
0
m Table
~
4.2.3.1,
Waterhen is masidered moderately forest industry dependent according to the cut-off
It+.
When tr-
payment recipients are included, Waterhen is considered slightly
forest industry dependat, at FDI equal to 0.080. Dependence on the traasfu
payment sector however, is quite high at 0.7785 (refix to Appendix 3, Table 3.3). If
both rhe transfkr payment and subsistence sector are included (column 3. Table
4.3.2.1) Waterhen is not considered forest industry dependent. Dependence on the
transf&rpayment sector is lessened to 05057, and subsistence sector dependence is
estimated to be 0.3874. The diversifying influence of including the subsistence sector
niminishes the estimated contribution to the total base economy fiom the forestry and
tr8LISfer payment sectors.
4.3.
Economic Basic Measures and Lter-sectoral Effects of W e t and Policy
Shocks
In addition to the problems associated with including subsistence with respect
to the basic/non-basic dichotomy, mother problem arises. Economic base analysis
does not capture the inter-sectoral effkcts of a potential displacement of resources
where sectors share inputs to production (Schwattz 1982). The subsistence and
industrialforestry sector share natural (the forest) and human resources in production.
As a result, the e k t s of-ket
and policy shocks within the forest sector may have
difkent impacts that, in the extreme, may permanently impair a community's ability to
participate in the subsistence sector*
Economic base analysis cap-
market changes as it affix& employment and
income. In the event of a market shock, such as a frll in the world price of timber, the
demand for labour inputs to production lessen, and conseqyently causes a decrease in
the level of basic activity* The hdeterminate e&cts of a change in iradua forestry
employment on subsistence participation were discussed in Section 4.2.1 as it pertains
to the basdnon-basic relationship. and ere equally applicable to inter-sectoral
relationships. Fluctuations in the forest industry market, such as decreases in the
prices of forestry products, cause a deer- in forest industry employment and
income.
However, a temporary market shock may not significantly f l i t a
community's ability to participate in subsistence.
Instead, in the event of lost
employment and income in the forestry sector, the subsistence sector may act to
diversify the total economy by providing an alternate form of activity and in-kind
income support.
Forest-relatedpolicy shocks, on the other hand, may affect the laad base that is
shared by both i
n
d
u
s
m forestry d subsistence in production. At a minimum, policy
shocks, such as the allocation of a new forest management agreement (FMA) or an
increase in annual abwable cut (AAC). inaeLses the intensity of use on a given forest
management knd base and may affect the area avnllahk f
a subsisteucc use. Many
subsistence hamesters have stated that timber barvesting activities scare off game.
destroy aVELil8ble habitat, and
increase access to both local and non-1d hunters.
Thesc are issues that forest industries d F i Nations people are currently tryiug to
address through abmtive forest maneganent regims. The problem with using
economic base analysis done to estimate the shock of policy change is that the benefit
of an increase in industrial fwestty activity is accounted for through the increase of
employment and income,but the potential cost of a decrease in the ability to engage in
subsistence &arvesringor an increase in subsistence production costs that arise firom
land use conflicts,are not. Policy shocks that limit a community's ability to engage in
subsistence harvesting consequently create a more specialized local economy, by
nanowiag the economic options within the economic base.
At the extreme, forest policy may cause a permanent state of change that does
not allow for multiple uses of either subsistence or the forestry sector by allocating
land for protection. If a portion of the land base is withdrawn fkom both forest
industry and subsistence uses for the purpose of protection, both the industrial forestry
and subsistence sectors are directly e t e d by the loss of land. and perhaps indirectly,
through the resutting increase of intensity of use on the land base remaining.
Economic base analysis captures the hnpact of the loss of employment and income
(from a withdrawal of forest laad) to the forestry sector, but again does not capture
the impact of loss of in-kind income in the subsistence sector.
The difkence between market and the policy shocks as discussed here is that
market shodcs do not directly change the size of lend base available for use in
subsistence. or fbrtst industry production Thus, t
k Pbility to participate in the
subsisten# sector may not be greatly d k t c d , and the community is better able to
absorb market shocks aflcixtiug forestry (and otba wage) empbymmt. However,
policy shodcs that decrease access or availability of the land base for s u ~ t e a c euse,
decrease the eamomic diversity within a community.
Changes in transfer payments also have inter-sectoraleffects. Although then
is no competition between the transfer payment sector and the forestry employment or
subsistence sectors for human and land resources,
transfa
payments contribute a
portion of the financial resources required to support subsistence production costs
(Condon el. al. 1991. Berkes et. al. 1991). A wmbination of seasonal employment
and traasfer benefits (specifically unemployment insurance) provides a balance of
income, and time not engaged in wage labour, identified by hamsters as
complimentary to subsistence production (Bakes et. al. 1994).
Policy changes that a&a a seasonal employse's/harvester's eligibility for
unemployment inmrmce benefits also a&ct the flow of cash hwme that may
fwilitate participation in subsistence production. Changes to policy that decrease the
inflow of income associated with unemployment insurance ba&s may therefore have
a secondary impact an a community's economy ofa decreased level of in-kind income.
In communities where industrial forestry,
W
e
payments, and subsistence
harvesting provide sounxs of income,policies that negatively aftect these sectors by
m
y narrowing alternative income oppormnities should be evaluated using a
fiamewotk that can estimate the inttr-stctoral effkts.
Chapter 5.0. Conclusions rmd Recomme&ons
for Ftuther Research
This study builds on previous measures of forest industry dependace in two
ways. Fnst,the calculation of forest industry dependent communitiw k extended
geographically by including Pll census suwivisions in the forested region of the prairie
provinces, iaciuding Indian reserves and rural districts. Second, by including a t r d e r
payment sector in the calculation of dependence a more comprehensive account of the
inflows of cash income to the local economy is provided. Historically, studies that
measure forest dependence have fmsed solely on wage employment activity. This
thesis suggests that a wider interpretation of forest dependence should include nontimber forest activities, specifically subsistence hamsting activity.
This study
provides a theoretical arlalysis of the utility of incorporating nowtimber forest activity
(subsistence harvesting) into the economic base dependence measure.
Where communities are heavily dependent on single resource secror(s) such as
forestry, shocks attributed to changes in the market and/or policy can have sisnificant
weIf'e effctts. The FDI provides a measure for identifying communities dependent
on wage employment activity. Calcula-
the FDI with the inclusion of Indian
reserves and rural districts results in a doubling of the number of forest industry
dependent communities than previous calculations that urclude these groups.
Including tlse traDsfer payment sector to the measure of dependence is an
improvement in identaying extend so-
of income characteristic of an community
economies. Previous studies that exclude the trsasfa payment sector fiom the
economy, overlook its role in diwsifying o h lhited, single sector dependent
c o m m m . If sources of income to all CSD's arc expanded to include udanal
sources of tr-
payments, the result is a deaeese in the total number of FDCs (in
all categories of dependtncc) by 18.9 percent, aod a clecmse in the total population
by 15.7 percent. However, e-
with the indusion of the tr&er
payment sector,
there is still a greater number of FDC's and overall population (about 62.3 d 50.6
percent more respectively) than when the FDI is calculated excluding Indian reserves
and rural districts, and tr811Sfer payments.
To further improve the dependence index, income should be used as the unit
of measurement. Due to data limitations, and for the purpose of comparison to
Fletcher's study, employment is used here. However, income measures wouid more
accurately r e f k t the variability in benefits received from different types of
empIopent oppormnities a d di&rent types of transfix payments. These difkrences
in benefits may signifkaotly alta calculations of dependence, ard would serve better in
identifying the nature of dependence on the trepsfer payment sector. Furthermore, if
subsistence activity is to be compared to cash income, using in-kind income would
eliminate the assumptions necessary to derive equivalentemployment measures.
The FDI does not provide an accurate measure of forest dependence in
communities where people participate in the subsistence economy. Although it is
intriguing to inch& the subsistence economy in measures of dependence, such
8ctivitics seemingly operate neither entirely as basic nor non-basic activity. To include
subsistence in the economic base measure of depeadcnce requires restricting
*
..
subsistence actnnbes to the basic sector. The FDI when rnlculatcd to mclude the
subsistence sector indicates that for Watuhen, SK, 38.7 pacent of economic base is
attributed to 'basic' subsistena activity. Furthermore. with subsistence included,
Waterhen, S K does not register as timber dependent (at mlI aqua1 0.0648). Despite
the problems associated with the FDI measure including subsistence, this analysis
demonstrates how the inclusion of subsistence activity provides a more accurate
picture of the total economy. Such cornmeties possess a degree of economic
diversity that is not captured in traditional applications of economic base models.
This analysis shows that dependence on the forest is wider than typically
captured by forest industry dependence measures. Where the forest supports two
different sectors (industrial forestry and subsistence hemsting), it is k l y that
changes in access to the forest resource brought on by activity in one sector will aEect
the ability to take part in the other sector. An account of inter-sectoral relationships
(apart from the direct basic/non-basic relationship stated by economic base theory), is
beyond the capability of the FDI measure.
The net efEcts &om my given shock in the
forest industry or transfer payment sector is not made known fiom this analysis. Thus,
where the subsistence economy is practiced, the FDI docs not provide a ranking of
colizmunitits VUlIlcrabk to impacts from market and policy shocks.
The and@ of how economic base dependence measures fbiI to account for
the relationship between the subsistence .ad the cash economy highlights some of the
speEific Worn tbat need to be a d d m s d by furtha research.
Although the
motivation and the benefits fiom participation m the two ~ n o m i e smay be quite
difkent, economic d h m i h t i o n is rccugnLed to be important to community
economic stability. The economic reIationship between the two economies is not
straigh~onvard.Where the rising cost of living and scarce employment opportunities
tend to increase the need to engage in subsistence, the increased cost of subsistence
production makes participation in the wage employment necessary. Models must be
capable of capturing this interdependence and &ow for possible competition between
inputs to production. One potential approach is a general equilibh modeL The
challenge would be to adapt the model to account for the production process of
subsistence, and also for changes in resource availability brought on by industrially,
governmentally and naturally produced changes in the forest environment. This latter
point has particular consequences where forest uses may be mutually exclusive.
The economic base measure of dependence provides a convenient method for
identification of forest industry dependent Aboriginal and non-Aboriginal cammunities.
Where forests and Aboriginal cownunitics coincide, the thesubsistence economy may be
a factor in economic base analysis. If so, more in-depth research is needed to fully
understand the e&as of changes in forestry products markets and policy on the
economic base of communities engaging in subsistence activity.
References
Alward G.S., W.G. Workman, and WR. M.ti 1992. "Regional Economic Impact
A n a l . for AIaskan \kriLllift Resouccts" in Vahhg WiWfe Rtsources in
Alaska, G L Petcrson et. al, (eds-) Social Behavior and Natural Resources
Series. Westview R-: Boulder. pp. 61-80.
Bdhtyne P., P. Brook, P. BUI'I~S,
D. Dorl~lony,G. Charles. 1976. A ~ k i - P U ~- O
Tbe
Land Alone. A report on the expected effi;ects of the proposed hydro-cktric
installation at Whrtego Rapids upon the Cree of the Pet- Ballantyne and Lac
La Ronge bands. Federation of Saskatchewan Indian Nations, Regina S K
Beckley, T.and B. Hirscb forthcoming. Subsistence and Non-industrial Forest Use in
the Lower Lisrd Valley. Information Report. Northern Forestry Centre.
Canadian Forest Service. PAmoatonBendavid-VaI, A 1991. Regional and Local Economic Analysis for Practitioners.
fourth ed. New York Raeger Publishers.
Berkes, F., PJ. George. RJ. Preston, RJ. Hughes. 1994. ''Wildlife Harvesting and
Sustainable Regional Native Economy in the Hudson and Jams Bay Lowland,
Ontario" in Arctic 47(4):350-360.
Berry, B.J. and J.B. Pam. 1988. Market Centres and Retail Locati011: Theorv and
Amlicaticms EaglewoodCli&, NJ.:Prentice Hall.
Blair, JP.1991. Urban and Reaional Economics. Richard D. Boston: IrwinInc.
Bone, R M and M.B. Green. 1986. "Accessibility and Development of Wtis
Communities in Northern Saskatchewan"in The Canadian Geonrmher
30(1):66-7 1.
Buckley,H. 1962. Traminst aad Fthin~in the Economy of Northem Saskatchewan.
Report No. 3. Economic and SocialSunzy of Northan Saskatchewan. Centre
for Community Studies. University of Saskatchewan, Saskatoon.
Callicatt, J.B. 1989. In Mnse of the Lend Ethic: Essay in Environmental
Philosophy. Albany: State University of New Yo& Press.
Canadian Forest Swict. 1992. Selected Forestry Statistics. Policy, Economics and
-
International Affairs Directorate Natural Resources Canada. Ottawa. a t .
W. 1966. Central P h of Southem Germany* (C.Baskin translation).
Engltwood W s , NJ.:Prcntict Hall.
Christak,
Coodoq KG.,P. Callings, and G. WenzeL 1995. 'The Best Part of LEc Subsistence
Hunting, Ethnicity and Economic Adaptation"in M c 48(l):31-46
Department of R e g i o d and Economic Expansion. 1977. Shde Sector Communifies.
Canada, Ministry of Supply and Services.
1979 Revised. Sinale Sector Communities.Canada, Ministry of Supply
and Services.
EIinn, P. 1991. Develo~ment of Aboriginal Peo~le's Communities. North York,
0nt:Captus Press
Fletcher, S.B. 1991."An Economic Analysis of Forest Dependent Communities in the
Prairie Provinces of Canada" USc. Thesis. Dept. of Rural Economy,
University of Alberta, Edm.
Friesen, G. 1984. The Canadian Prairies: A History. Toronto: University of Toronto
PressFuller, T., P. Ehrensaft, and M Gertkr. 1989. "Sustainable Rural Communities in
Canad8: Issues and Prospects" in Sustaimbt Rural Communiries in Canada.
M. Gertler and H. Baker (eds.) Proceedings. Saskatoon. Oct. 1989.
George,
P. 1989. "Native Peoples and Community Economic Development in
Northern Ontario" in British J o d of Canadian Studies 458-73.
, F. Berkes, and RJ. Preston 1995. "Aboriginal Harvesting in the
Moose River Basin: A Historical and Contemporary Analysis" in The Canadian
Review of Sociolonv and Anthrmloqy 3 l(2):69-90.
Gibson, L.J. aad M A Worden. 1981. 'Estimating the Economic-Base Multipk A
Test of Alttrnative Procedures"in Economic Geography 57: 146-159.
Giles. R.G.and RA. Bohaing. 1992. Directom of Rkwy Wood-Usin~Industries in
Manitoba 1991. Forestry Canada, Winnipeg,Uanitoba.
-
Greytak, D. 1969. "A Statistical Analysis of Regional Export Estimating Techniques"
in Joumal of R e a i d Science 9~387-395.
Home, G. and C. Permer. 1992. British Columbia Community Ernplopem
De~~adeucies.
Pknaing and St.tBtics Division, Minisey of F i and
Coprate Relations. Feb.
Institute of Norhem Studies. 1978. Sacio-economic -act
of the R O D Uranium
O~
Saskatchewan, Saskatoon.
Isard, W. 1960. M;tthods of Regional Andvsis: an Introduction to Regional Science.
Englewood, C l B s , NJ.:Rentice W1 Inc.
Isserman, AM. 1977. 'The Location Quotient Approach to Estimating Regional
hpacts" in Journal of American Institute of Planners 43:33-41.
Kusel J. 1995. A New b ~ r o a c hto Well-being in Forest Dependent Communities.
Siecra Nevada Ecosystem Project, Social Assessment. Part I. Uaiv. of
California, Berkeley.
McNab, MA 1992. ''Persistence and Change in a Northern Saskatchewan Trapping
Community". MA Thesis.Dept. of Anthropology and Archaeology, Univ. of
Saskatchewan,Saskatoon. 162 p.
Milk, J.R. 1991. The Skyscrawxs Hide the Heavens: A Historv of In&-white
Relations in Cansda Toronto: University of Torocto Press.
Mitchell, J., ed. 1975. Churchill River Study Sacio-Economic F d Reports.
Manitoba and Saskatchewan. Reports No. 21 ad 25. S8skatoor Univ. of
Saskatchewan.Depts. of Economics and Political Science.
Muth, R M. 1990. 'Community Stability as S o c .Structure: The Role of Subsistenoe
Uses of Natural Resources in Southeast Alaska" in C o m m and
~ Forestrv
Continuities in the SbCi01onv of N a n d Resources La, R.G. d W.R. Burch
k (eds.) Boulder,Co:Westview Press.
National Aboriginal Forestry Association. 1993. Aboriginal Forestrv Training and
Em10yment Review Final Report. Phase L February.
James Bay and Northan Quebec Native Harvesting Research Committee. 1982. The
Wealth of the Lad: Wildlife Hatvests bv the James Bay Cree. 1972-73 to
1978-79. Find Report. Quebec City.
Nutrition Liaison Committee of NWT. 1984. "Protein Content of Commonly Eaten
Meats" in Native Women's News 3(2): 1.
North, D. 1955. "LocrtEon Theory and Regioaal Economic Growth" in 1 0 4 of
Political Science 63(June):243-258.
Northem Manitoba Economic Development Commission. 1992. Northan Manitoba:
. .on.
A Benchmark Rewrt. Winaipeg:'Ihe Canrmssl
N.C. and N.T. McBride. 1987. "The Structure of an Arctic ~ o c c o n o m y
The Traditional Sector in Community Economic Development" in Arctic
4O(3):2O4-2 10.
Quigley,
Palmer, J. 1973. Social Accounts for the North: Interim Paper No. 3. 'The
Measurement of Incomes in the Yukon and Northwest TetTitories". Ottawa:
Dept. of Indian Affairs and Northern Development, Economic Staff Group.
Pharand, N. 1988. Forest Sector-Dependent Communities in Canada: A Demosa~hic
Protile. Momation Report No. DPC-X-23. Canadian Forest Service, Labour
Market Development Branch, Ottawa, Ont.
PIeeter, S. 1980. "Methodologies of Economic Impact Analysis: An Overview" in
Economic Impact Aaalvsis: Methodolom and Aoplications. Pleeter, S. ed.
Baton: Martinus Nijhoff Publishing.
Richardson, H.W. 1985. "Input-Output aad Economic Base Multipliers: Looking
Backward and Forward" in Journal of Regional Science. 25(4):607-661.
Riffel, J.A. J. Burelk, and J.P. Kelly. 1972. The Ouality of Life of Native Peo~les:a
Discussion Paper and Research Develo~meatRomectus. Winnipeg: University
of Manitoba.
Schwartz, H. 1982. A Guide to Regional MultiDlier Estimation Canada. Dept. of
Regional and Economic Expansion.
Schindeka, C.R. 1978. An Ehmhation of &e Food Resources Harvest in the
Churchill River Studv Area. Saskatoon: Institute for Northern Studies,
University of Saskstchewa~~
Statistics Canada 1993a. megation of Standard Industrial Qessibtion Codes,
1980. Supply and Services, Ottawa
-
1993b. Data Documentation for the Pro& Series - Part B. Ottawa:
Supply and Services Canada, 1993. 1991 Census of Canada.
Staelc. T.W.. DM. Boylm. and A B a m p m e r 1988. Saskatchewan's Forcstq
Iuduse. 1985. Canadhn Forest M a ,NOR-X-295.
Tiebout, C.M. 1956. ''Exports and Regional Economic Growth" in Journal of Politicel
Economv. 64(April):160-1 8 .
Tobias, T.N. and JJ. Kay. 1992. T h e Bush Harvest in Pinehouse Saskatchewan,
Canada'' in Arctic 47(3):207-221.
Usher. PJ. 1971. The Bankslaraders: Economy and Ecalow of a Frontier Trm~inq
Community VoL 2: Economy and Ecology. Ottawa: Dept. of Iadian Mirs
and Northern Development (NSRG 71-2).
1976. "Evaluating Country Food in the Northern Native Economy" in
Arctic 29(2):105-120.
and G. WenzeL 1987. "Native Harvest Surveys and Statistics: A
Critique of Their Construction and Use" in Arctic 40(2): 145-160.
Wagner, M.W. 1985. 'Domestic Hunting and Fiihhg by Manitoba Indians:
Magnitude. Composition a
d Implications for Management" in Canadiaa
Journal of Native Studies 6(2):333-349.
Wddram, J-B. 1988. As Lana as the River Runs: H~dro-e1ectricDevelo~mentand
Native Communities in W e s t Canada.
~
Whpeg, University d Manitoba
Press.
Wein, E.E.,J.H. S a m and F.T.Evas. 1991. ''Food Consumption Patterns and Use of
Country Foods by Native chadiam near Wood BufFao National Park,
Canada" in Arctic 44(3): 196-205.
Wein, E.E. 1989. "Nutrient Intaltrs and Use of Country Foods by Native Canadbs
near Wood Buffalo National Park". Doctoral Thesis. Dept. of Applied Human
Nutrition. University of Guelph. Ontario.
White, W.,B. N e w S. C~K,and B.A. Fraser. 1986. Forest Sector Depende11cc in
Rural British Columbia. 1971-1981. Momation Report No. BC-X-278.
CMadiaa Forest Savice. P M c Forestry Centre. Victoria, B.C.
Wolfe, RJ. 1987. 'The Super-household: SpecMiation in Subsiste~lceEconomies".
Paper presented at 14th h m a l Nkcting of Alaska Anthropological Assoc.
March. 1987, Anchorage.
Young, D. 1989. 5ingIe Industry Towns" in Sustahable Rural Cornin
CaaaaaM.Gtrtlcr and H.Baker (eds.) Proceedings. SllsLatoon. Oct. 1989.
Appendix I . Censur Data Issues for the CaIculution of the Forest Dependence Index
A drawback to using employment data is that it implicitly assumes drat alljobs
are the same type (it.. fun time, part time, seasonal, temporary), and that the be~ltfits
&om each type of job do not vary ricmifirantly (iie., are similarly remunerated in term
of wages and saleries) (Fletcher 1991). Using income as the measurement unit can
produce a more accurate esthnation of the basic and non-bask seztors. Employment is
used to estimate the economic base in this study due to data limitations and to
facilitate comparison with Fletcher's calculations.
For studies based in Canada, employment data k easily obtained fkom the
census. However, the way in which the ctnsus obtains and estimates employment data
may create problems. The census surveys obtain employment info;mation based on
the job an individual was working in the last week prior to enumeration, June 4. 1991
(Statistics Canada 1993b). For seasonal employment, if summer (June) does not
represent the average number of seasonally employed for the year (ie., if there is more
(or less) seasod employment in the other thne seasons than in the summer) then the
employment count is unlikely to represent an average.
The estimates of emplayment used by Statistics Caaado ako cause problems
for measures of dependence. Census tabulations of employment are subject to random
rounding to emure confidentiality of respondents. In small cornmunitits, employment
numbers can be rounded upwards or downwards &om zero to ten.
In small
communities, Smon absolute changes in employment iaduce large chges ia the
calculation of the FDL Thus random rounding can have a signiticant e f f on
~ the
level ofdependence in small communities.
Appendir 2.- Aggregation of Standard Industrial ClassificationCodes (1980) into Sectors
(Statistb Canada 1993a)
Mining
QIlaay and Sand Pit
Setvices incidental to Mining
CaalMines
Gude Petrokum. & Natural Gas
Ref3ledPeaol,&WPtwlucIS
Fishing and Trapping
FiProducts
Constructian= Highway & h v y
Utilities: Elect& Power Systems
Beverage;Tob8cco;Rubber; Plastic
Leatber&AlliedRodncts; E%muy
Textiles; and T
&
Roducts
Q*.
Furnitute & F i :P r a n g
Publishing & Allied: Primary Metals-.
Fabricated Metal Products:
TranspatEquipmen~Elecbricaland
ElecaonifsRoducts
Communiration
& Other Utilities H
Communication
Other utility Industries
L;ardkmlp,I)nrg*&T-
Apprrrei&DryGoods;HMom Vehicle Parts &
~ . S a l e s & S e r v i.a ;
GeIEralRetril IMwmhlg,and
O t b e r R e t s i l S ~ ~
Educational Senrice
0
85
Other Service Industries.
Appendix 3.TaMe 3.1:
P
Pap
Pm.
Ge~a:'
TW
Em,
TII. Bese
Emp.
T
FDI
Ag 01'
EnDP
-or
F&TDI0
[email protected]
camnUnity
Pap.
Prw.
Geai:
Tdd
Emg.
TI!. Base
Emp.
FDI
!!@~8Hi!83i8Q~IHBiif13
a o o o o o o o o o o d o o o o o o o d d d
-nfnW
Fm.
Oeos:
Tdal
Errp,
TI1, Bese
ER~.
I,=
SK
78S
372.4
2,3W
MN
47140040
$6010710
910
848
SK
47160750
2082
147.5
1,888
SK
MN
AB
MN
MN
MN
47140010
385
800
Pap,
HWvyFanWlndurtry-HurlsonB~y
-Ahwlch
Big River Na 566
Hudsar Bay No.304
The Pes
--
-
0,188
1,-
I,=
- ~ ( C e r r o l V ~
P~m4w
-
736
1,558
--W
46210150
48130020
46210410
48010750
480103;8[)
840
300
322.8
9049
274.2
200.3
155.7
510
225.8
2,845
66
t ~ ~ F D p o p l i l l k 19,019
n
~
m
t
a
u
~
~
:
FDI
CaMnurridy
CQMUJt)r
-Stave)y
-MeadanW
W a l m 130
-
-0uckLdrsNO.463
-I.D. No. 14
PeiicanNarronrs
-
P .
t)rcN.
Pap.
Rw,
Oear:
478
4,318
-40
47170520
ee2
A6
8N
SK
SK
8
262
A0
SK
40140030
471805#)
508
47178080
47150810
Tad
Emp.
Ttl. BgEe
Tald
Em.
170
Ttl, BBse
1,715
90
FDI
Em.
Emp.
73.1
586.8
455
4Q.8
200.7
3,m
75
1517.7
51.7
FDI
commnily
--
-SmdcyRkerNa130
*
-
-SelrLk
WeSlkdr
-
- Richd
--Na87
High Rhfer
YorMm
-
- Fat McMurray
-Csnmae
Pap.
Rau.
Om:
Tdal
Enp.
1,235
373,lOS
4,ttO
1,820
2,100
Ttl. Sese
Emp,
2,613
AB
710,677
A8
081eM10
$8080180
9,815
4,719
5,132
5,140
10,289
MN
4613W70
AB
AB
48130310
481MOBO
MN
-750
48120040
2,585
417,8
5,130
P02,3
8,280
15,315
AB
SK
A8
A8
2,M
gSa.3
47090120
6,450
18,130
2,990
2115.8
7574,3
1018.0
34,706
5,681
AB
4616041)0
481-
6973
101784.8
8323
596.5
m.5
cammunYy
Pclp.
b. Gem
Tdd
TtI. Base
FDI
FOI
---(werJeeS)
-0MdarNa21,unO
-0uckldmNa4m
--wdo
P m Rker
-
-018~nCdt6
- Edaan
-Paddadnm#dNarn
- I. 0.Na 17
-Meedanme
--(Cranbsrryeartage)
- I.0. No.14
-QarderrRhrerNo.490
-mlceAlberl
P
-Maassp)angeNa086
-0randeM
- l.O.Na21
- vuna
- s-
~
~
TPDl
Ag Dl
EnDl
MnDI
FlLTDI
H@. Dl
canmUnity
Pap.
Rw.
Gw6:
Tdd
Emp
Ttl, Base
Emp
i O C i O f Z 0 8 8 3 i 3 t f t i l skB 8ff~ f P 8 ! I O !
~
O
O
O
~
O
O
O
O
~
O
O
~
O
~
1111833tf383333P981Di1QffHIIi8
O
O
~
O
~
O
O
~
~
O
~
~
O
~
~
O
~
~
~
~
O
~
~
1 ~ 1 8 1 ! 1 8~8= 8 1 1 8 8 0 0 % 8 H H H i I 1 B I O B H
d o o d o o e o o d o o o d o o o o o o o o o o d o o d o
~
3 di !
d8
o d
8o%
o d8dH
d o8el df o
l lolol oSo8d8o %
d d8
d d
i 8d 8o o8d8d8 f I 8
tf3888888t%fSP~86@8!ItifhOIt~
O
O
O
O
O
O
O
P
~
~
~
~
~
~
O
O
O
B
O
-
O
~
w
c ; f E ~ ;~
l n m ~ 6 ~~
! i f J ~ f i~
t~
~ ~J
is
8
i! l r d- 4 4 .B1 E e
B
1
B
t
1
a
D
a
a
a 8 8i R
a
,
.
,
za?;twsa
,
,
a
,
a
,
,
a
~
~
~
e
m
,
o
,
L
---
Gem:
Tdc9
Emp
Ttl.Bsse
Emp
FDI
-
4812009
48lmI
481d04e
2,890
3,W
847.5
1,070.7
0.0048
0,0034
~,m
AB
A8
j~e
am
4615023
3,595
0,010.0
1,0273
0.0028
- YaMon
!itat A6
6A8
15,315 SK
-
W e
Fa1Mhmy
-Cem#e
HWRW
Qeos,: Smdmd
Pq% Rw.
5,132
4,7W
3,875
47090120 10,325
2,949.0
0.W
0,0015
En01
MnD1
FbTD1
Hyd, 01
0.3378
0,0000
0.9892
0.0000
0.0000
0.0000
0.1388
0.0000
0.0000
0.8125
0,0000
0,0000
0.6000
0,0173
0,0090
0,0000
0.0580
0,0060
0.0000
0 , m
0,0.0000
0,0000
0.4447
0.5018
0.0291
0.W7
0,0060
0.0241
0.0086
O.OOOO
0.00M
0,0000
0,0000
0,0.0000
clade; 1.e.47140040,the t&sllwodigb rdw t o m pwbxialoode (47) is SaWchewm,lhinerd two d#s (14) rs(a to the
TeDI: deQendence&ufexcdaWd lathe T m f a PaymerrEe seclor
En Dl:
807.Q
0,0027
Ag Dl
TPDl
Wex c d c W d fa the EWW seclu
--m148
-LO-No-18pm)
- ~ w n N o . s m
-T'imdm
w-
-8lr.Anm
-Mclrmm
-m
*LD,Fk.#
-LO.N&21
smolyWaCMNO.13
.Wrm
- Flfrvkw
.Mou-n
(South)
OMdonNo.22. Urn
.Bumwd
-Mtur
.mfmP
- F l o e k y ~ n ~
.Hmon
L.tsie.AmsCMNo,P
.Nnpl
QlnkClctr
LO.No.22
b
NO. 484
HrdDdlNo.3s
.wfmtmw
-w.rtsLPul
--
-Nlp.rrln
- mncmAbrrNo.46t
--Rlmr
-Rodarood
- ~ N o . s a
-L.clrBkhB
-w.rtkdtNO-a2
*st.-Bu(l.kNumwr
-Rh
-mdatmwNo.497
-cro6Rwd
- ste- Am0
- I. 0. No. 15
- Minitoms
-om
-pUw.kNO-498
- Vdkyukrr
- Aim.
-Moaw ~ N o * 4 8 8
-L.-
-PoreuplnNo.595
-Nlvwrr[lk
-CW-Wo
-LD-Na.16
-8J#rk
-GRnd.PnirkCMNo*
-kRarrg,
-FosrCmlr
- Wn'mNo. 138
-LO.No, 5
--m-
-klntnuyNO.aos
-prwcwmNo.33r)
- emerullk No, 334
-Thornpan
- Yar#acl
-€&on
Appendix 5: Esti~*on
of in-kind Incomefiom TraditionalH m e s t Stuvey Datu
5.1 Estimate of Volume Hwcsted: Waferhen, Slskatchewm, 1992.
Traditional hemst survey
m)data used in this study was collcded by the
Meadow Lake Tribal Council of Saskatchewan for use in forestry management plaaniag.
The THS was conducted for 1992 barvest rates on Waterhen Reserve 130.
~askatchewaa" The MLTC sump were not conducted for the purpose of this research.
However, this analysis demonstrates the importance of collecting information that is
accurate d consistent. It is unlikely that any given set of THS data will meet the
requirements of all research interests (Usherand Wenzel1987).
The response rate to the smeys was 95 percent of alL households. e.
total
number of households surveyed was 142. One household head responded for all
household members; the sample population (all ages) is 556 people.
the sample
population, 282 persons were over the age of 15 (about 51 percent), and 16 people
reported being over the age of 65. Of the 282 who provided demographic information on
their households, 8 pemple did not comment on their personal subsistence a~tivities.~'
The remaining 274 pcrsons represented in the m
y consisted of 138 women and
136 men. There w e n 93 people (33.9 percent) who stated they did not participate in
harvest activities. Thae were 181 people (66.1 percent) who stated they engaged in
" It is not known how representative the 1992 hamest year is d the subsistence harvest 1LSSdCi8tedwith
the 1991census year.
There were six perscms who nfosd m cornmeat cm subsistence mivities. and two
they were too sick that year to take part iu the 1992 harvest.
31
who said
- .-
subsistence actMms Of the sixteen seniors 65 years of age and older, only one said they
did not participate in harvesting activity.
The swey was based on the i n d i d a d ' s r e d of their subsistence activity and
harvest of big game, game birds, fish, beniw,
and fbelwood in the previous calendar year.
Questions regarding trappiag activity were asked on the swey, but vay little activity was
reported. Many respondents explained a "no trapping" response by noting low pelt prias
in 1992; fur prices have been dropping since 1984 (McNab 1992). The trappiug data
reported in the surveys was inadequate for &dating
a hamst value (ie., incomplete
answers), and was omitted 6rom the final calculation of harvested volwne,
Fur trapping for non-local, commercial sales is caosidered basic activity. Trapping
is categorized according to SIC codes. So trapping is captured by the standard economic
base measure. However, the meat fiom trapped species, and the fur used for domestic use
(ie., subsistencs use of trapped species) is not captured in the THS. The co~tributionto
domestic consumption fiom species like rabbit, beaver* muskrat and squiml may be
significant, particularly to the elderly meckley and Hinch forthcoming).
Idomtion was collected concuning the harvest of medicinalplants, however, ao
attempt was made in this study to impute a market value. The properties of such plants
are not easily equated to pharmaceutical substi&tes, if such substitutes even exist- Wild
rice hamstiqg, as well as ~ g / o u t f i t t e rsenrices were also reported but could not be
quantified, and thus are not included. Lastly7 there were no questions pertahkg to craft
or alternative forest product production/coUectionin the survey.
Calculating v o h ofharvest based on sumy data was complicated by responses
that were qualitntivt (LC., some, a few. a lot), W blank (no amount recorded but
participation in raivity kkated), or not readable. Rather than ignore their actbdk, an
average amount harvtsted within each category
(Mimpls, bcmh,
caIwJated and used for active a d moderate harvesters?
and fuelwood) was
Table 5.1.(1) shows the
percentage of estimated rtsponses and respondents for each category.
The total numkr of nsponses and volume harvested estimated, as a percentage of
the total (responses and volume) was not significantly large, except perhaps or fuelwood.
Many respondents said they spent time wIlectbg fuelwood, but did not state the quantity
of wood that they collected. As a result almost one-third of the volume of wood
harvested is based on calculated average values.
Table S.l.(lk Percentage of Estimated R e m o m s Out of Total Res~onses,
Water& Saskatchewan. 1992;
proportionofestimated
responsesoutoftolalresponses
big game
birds
ikh
berries
he1
6.7
la4
7.a
122
233
Total volum of domestic hamst is based on the total edible weight of each
species harvested. In a pnJimhary survey, respondents felt it was too personal revealing
the number killtd for each individual qxsks. Instead, numbers for killed and harvested
game were obtained for the broad categories of:big game, game birds, and fish. The
volume of harvestin each category was then divided into subcategories of commonly
'' "Active"
-
--
is defined as having =gaged in three or mme subsinena activities. ''makate" participants
engaged in one a two bushactivities.
harvested speck, according to the proportion
of species harvested for a typical year?
This is a#ressarybccauseofthekrgediEere~~~~~
involnmeofedibkmeat that the various
species provide- Tabk 5.1.(2) shows the proportions used to ulcuhue the percentage of
each species harvested, as well as the edicble weight (kg.) for each species.
Table 5.1,(2): Robortion of Species Harvested and
I
140.00
duck
2
525
Partride
whitefish
pickcral
30
73
24
033
0.78
0.73
m
3
0.87
cfk
Game Birds
FIS~
I
h
0.77
'~diileWeights fa: moose, deer. duck.partridge. a
d all species offish Mfrom Tobias d Kay (1994);
elk is frolm Beckley and Hirsch(f-:
and Canadageez~h u Berkes et- al- (1994).
Conversion factors for fuelwood, according to Tobias and Kay (1994), equate one
half tonne truck load of uncut logs to 0 5 cords. It is not clear whether truck loads of
fuelwood reported in the THS were uncut or cut. Although the above conversion factor is
used in this study, it possibly represents a minimum value since a truck load of cut wood is
greater
than 0.5 cords.u
if wood is
equivaknt to -75 cords of wood
at,
one truck load would be approximately
Fuelwood volume, and value, could thus be
underestimated by as much as 25 percent.
~ o p a t i ~ ~ d s p d e s h m g c d f a r a t y p i yc eaat r i s b u c d c m p l s o l u l c o m r u n i c a t i ~with and&
(who is also an active hamster) cf the Waterhen L& F i Natia Sane specks (swans* cranes. sncvw
g e e s e . s a m e f i s h s p e c i e s ) a r e ~~naregolatLy~ncrinlrrgepropattiaascampvsdmcammaa
species. Volume of hanrest of thesespecks. since harvest is mtennittenL is not estimated here.
Y~h~~tanae~bed88tlaog.4fcetwi&.and36k1dcep.ara~oPdmatdy%
A~bic~
cord is 128 cubis feet
33
5.2 Estimate of In-kind Value
Replacementvalueisusedc~samc~slneofin-kitulvPlued~by~g
what it would cost the community to replace harvtstcd foods (pound for pound) with a
store-bought, if they did not engage in subsistence Replacement value provides a
weke-equivalent measure suitable for comparing the income contributions of subsistence
of di&rent cornmunitits. Replacement values are not suitable for deriving the income
contribution of a community to a national income measure (ie., such as that needed to
calculate economic base multipliers), because it does not account for the production wsts
of subsistence, such as gas, ammunition, equipment and repairs (Usher 1971, Palmer
1973). Also replecement values do not account for the superior nutritional value and taste
of country foods (Wein 1989, Nutrition Liaison Committee 1984). Nor do replacement
values account for the fact that people are likely to choose cross-substitutes,depending on
relative prices, availability, and/or personal preferences.
R e p w e n t values are used here to illustrate how a substitute value can be used
in the dculation of the FDI. Generally. it is believed that it is better to provide a measure
of subsistence hervest, acknowledging the theoretical Md methodological lhhtions
resulting from replacement value calculations, thaa it is to ignore this sector's contribution
to the total economy (Palmer. in Usher 1976).
The replacement value of the subsistence
harvest is determined by calculatiag
average prices for store bought substitutes. Table 5.2.(1) lists these prices. An average
was taken betweax available substitutes; the months of September and March to a d . t
for seasonal di&rences in prices (and availabk substitutes); and the two main grocery
stores in W o w Lake.
Beef was used as a substitute for the big game specks, moose, deer and e k The
a v ~ g price
e
of a v*
of cuts is uscd,since using only ground beefpsias luldemalues
the hmvest, particularly since none of the butchccedgame is aduPly ground. The imputed
price for big game ($12.14/lcg) is higher than the price used in Tobias' and Kay's 1994
study as a result.
Average prices of roasting and frying chickens ($4.23/kg) is used to approximate
prices for the harvest of ducks, geese, and partridge. Since store bought prices include
bones, wherw edible weights do not. a discrepancy results. Thus, pound for pound, the
store price underestimates the amount of meat, and thus the value of game birds.
There are no fkesh whole fish available in either store, although fiozen (fresh) fish
is sometimes available. The other alternative substitute would be breaded, fkozen varieties
of cod. The frozen, whole fish is likely the closest and least expensive substitutete
However, since it is not always available an average was taken for a l l fish products. The
imputed average price h $7.08/kg.
Fresh blueberries and strawberries are available in the stores in the spring but not
winter. The prices of fresh and fiozen benies arc averaged to get a par-round price of
$5.18/kg. Lastly, cords of wood arc not sold at either store considered, but am available
elsewhere for $80.00/wrd @asonal communicationnsidcnt).
I~mary
c 5 , 2 . 1 1 ) : c e s 1991.
.
IGA
OP
AVC-
tnderbm
average beefprice&.
a0.62
roasting chicken
h e r chicken
average chicken price&.
421
fkozea6sh h batter
average fish pricekg.
1131
8.41
hzen berries
average berry price/kg,
6.82
-
2IS
price
I
21.06
$=I4
392
4-49
430
4.35
4.11
$423
9 s
6.82
S.18
-TO To11991s m e piaJ 1993 priccJ wap adjustedusing the
cammsr price index f
ameat and food categoriesf
aS-wan.
Combining prices with calculated estimates of edible harvest (kg*) enables the
calculationof replacement values. These are presented in Table 5.2.(2).
Table 5.2.(2): Estimates ofEdi'bIe Weights and Rdacemctlt ValWaterhen R t s e m . Saskatcb_ewaa 1991
species
number
harvested
edible kg.
perkill
Bin Game:
rota1
same price
kg-
perk&
replacement
vahe
.
elk
140.00
I
btal:
1,113.00
37.OlO.aS
l214
.---
Sl3311.82
W93l2.01
I
bane Birds
partridge
total:
jackfish
lotal:
berries
mtak
fireiwjwd
lotrl:
2Za
0.33
73.33
423
m.25
-,6
edible kg.
hamesled
m2.S
$310N
a74997
m.11
edible kg.
7.a
sw1.13
$45,37133
5.17
$9,319.03
# ofcords
l*szs.at
a
0
0
SWO.001.60
5.3. Ovemiew of the Totd Economy of W.terhen kscmc, Saskatchewan
The replacement value of $636, 743.93 is calculated foF the estimated harvested
volume for the 142 househobh SUNG^^^ The average replacement value per household is
qua1 to $4, 484.11.
Extrapolating &om the average value pa household over all
households (there are 150) results in a totd estimated value of !§672, 616.83 for the
community of Waterhen, SK
Total community cash income from both full and part time employment wages and
government tr8ILSfer payment sources is obtained from the 1991 census. Total cash
income amaunts to $1,990,74670. Based on percentages provided by Statistics Canada
in the 1991 census, part and full-time eqloyment income conmibutes 529 percent to total
cash income,or $1,053,105.00. Transfii payments (46.4 percent is government tranders
md 0.8 pucent is from investment payments) contribute 47.2 percent to the total
economy, or $939,632.44. In-Wincome contributes largeiy to the total economy of the
Waterhen community, boosting total community income to $2,663,363.50.
The contribution from the sub&tencc sector emphasizes the importance of
identify& the Waterhen reserve as khg dependent on thesc forest-related activitieg.
Although the FDI can be adapted to include in-kid income, it does not pro+
a description of the economy. Thus, it is inpatant to seek m
more than
understaadjng of the
interrtlationsbips betwan wage income, the trPnsfer pagmat scctor and the s u b s m a
sector, before the effkcts of potential change brought on by market or policy shocks in the
forest industry sector (or any sector) can be ckarly identified