Does Wal‐Mart Sell Inferior Goods?

9 Pages Posted: 21 Sep 2011

See all articles by Emek Basker

Emek Basker

U.S. Census Bureau - Center for Economic Studies; University of Missouri - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 2011

Abstract

I estimate the aggregate income elasticity of Wal‐Mart's and Target's revenues using quarterly data for 1997–2006. I find that Wal‐Mart's revenues increase during bad times, whereas Target's revenues decrease, consistent with Wal‐Mart selling “inferior goods” in the technical sense of the term. An upper bound on the aggregate income elasticity of demand for Wal‐Mart's wares is −'35.

JEL Classification: L81, D12

Suggested Citation

Basker, Emek, Does Wal‐Mart Sell Inferior Goods? (October 2011). Economic Inquiry, Vol. 49, Issue 4, pp. 973-981, 2011, Available at SSRN: https://ssrn.com/abstract=1931338 or http://dx.doi.org/10.1111/j.1465-7295.2009.00195.x

Emek Basker (Contact Author)

U.S. Census Bureau - Center for Economic Studies ( email )

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Washington, DC 20233-9100
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University of Missouri - Department of Economics ( email )

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Columbia, MO 65211
United States

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