Has Wal-Mart Buried Mom and Pop?: The Impact of Wal-Mart on Self-Employment and Small Establishments in the United States

Economic Inquiry, Vol. 46, No. 4, pp. 676-695, October 2008

20 Pages Posted: 27 Oct 2008

See all articles by Russell S. Sobel

Russell S. Sobel

The Citadel - School of Business

Andrea M. Dean

West Virginia University - College of Business & Economics

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Abstract

This paper explores the widely accepted view that Wal-Mart causes significant harm to the traditional, small mom and pop business sector of the U.S. economy. We present the first rigorous econometric investigation of this issue by examining the rate of self-employment and the number of small employer establishments using both time series and cross-sectional data. We also examine alternative measures and empirical techniques for robustness. Contrary to popular belief, our results suggest that the process of creative destruction unleashed by Wal-Mart has had no statistically significant long-run impact on the overall size and profitability of the small business sector in the United States.

JEL Classification: L81, D59, C21

Suggested Citation

Sobel, Russell S. and Dean, Andrea M., Has Wal-Mart Buried Mom and Pop?: The Impact of Wal-Mart on Self-Employment and Small Establishments in the United States. Economic Inquiry, Vol. 46, No. 4, pp. 676-695, October 2008, Available at SSRN: https://ssrn.com/abstract=1288870 or http://dx.doi.org/10.1111/j.1465-7295.2007.00091.x

Russell S. Sobel (Contact Author)

The Citadel - School of Business ( email )

171 Moultrie St.
Charleston, SC 29409
United States

Andrea M. Dean

West Virginia University - College of Business & Economics ( email )

P.O. Box 6025
Morgantown, WV 26506
United States

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