The Lone Ranger and Tonto Fistfight in Heaven was written by Sherman Alexie. The setting of this collection of stories plays an important role in revealing the characters' struggles. The Spokane Indian Reservation is located in America, and yet it is very different from the towns and cities in America. Alexie accurately portrays the poverty, the social problems, and the isolation of the reservation in a way that shows the trapped state of affairs for many Native Americans.
One of the major problems that some Native Americans in the stories face is that they cannot successfully live outside the reservation due to their customs, beliefs, skills, and education. The reservation consists of low-income housing with very few amenities. There are virtually no new jobs being created, and there isn't much reason to hope. There just aren't many options or opportunities in the reservation.
At the same time, the Native Americans identify with the area closely. The city of Spokane is practically uninhabitable for them. Living on the reservation is challenging, but urban American life is even more difficult for the Native Americans to adapt to, if not impossible. The setting shows how modern Native Americans, including the protagonist, Victor Joseph, are neither fully assimilated with mainstream America nor prospering in their own land. So they are trapped in between the two societies.
As a result, the reservation Native Americans struggle with figuring out their place in American society. Thus, the poverty of the setting is contrasted with the richness of American city life in a way that conveys the protagonist's internal struggle. It is fair to assume that Victor would feel more comfortable with and confident about his Native American traditions and way of life if he were assimilated into American culture and society, and that simply isn't the case.