The Local Economic Impact of Wal-Mart By Michael J. Hicks

This does not mean that these things are not important issues. On the contrary, they are so important that I leave the analysis to researchers in management and law who specialize in these areas.

The pieces of Wal-Mart’s story that I do analyze remain very exciting elements of the U.S. and increasingly global economy. In fact, these issues are so important that there is an explosion of research and educational issues related to the subject. Furthermore, there are a surprising number of courses on Wal-Mart across the academic spectrum. One anti-Wal-Mart group even developed a curriculum that is being taught at over 25 colleges and universities nationwide. Constance Hays, writing in the New York Times in 2003, relates that the study of Wal-Mart has become a “Topic A” in business schools.²

To analyze the relationship between Wal-Mart and the markets in which it operates, I have organized the book into five sections, which focus on the most salient local issues surrounding the opening and operation of a Wal-Mart store. In Section I, to establish a context for the study, I discuss the history of chain stores and the transition to big-box stores, which are now such a common mechanism for bringing goods—and increasingly services—to consumers. I follow this with a mapping of Wal-Mart’s locations and a discussion of the measurement of impacts used in the book. This is followed by an analysis of how Wal-Mart locates its stores.

Section II considers Wal-Mart’s impact on labor markets, the markets for goods and services, and the aggregate local economy. The chapters analyze questions regarding how Wal-Mart impacts the private sector, areas that have been a prime target of inquiry over the past 15 years. Wal-Mart’s impact on local tax revenues and expenditures and on antipoverty and health care programs—the latter an obvious policy frontier—is the focus of Section III. Section IV deals specifically with social impacts of Wal-Mart. By this, I mean factors such as sprawl, union participation rates, poverty, income inequality, and local philanthropy.