What is ‘Wal-Mart Effect’
The economic impact felt by local businesses when a large firm such as Wal-Mart opens a location in the area. The Wal-Mart effect usually manifests itself by forcing smaller retail firms out of business and reducing wages for competitors’ employees. Many local businesses oppose the introduction of Wal-Marts into their territories for this reason.
Explaining ‘Wal-Mart Effect’
The Wal-Mart effect is not all bad; it can also curb inflation and help to keep employee productivity at an optimum level. The chain of stores can save consumers billions of dollars, but may also reduce wages and competition in an area.
Further Reading
- what is the local WAL-MART EFFECT? – search.proquest.com [PDF]
- Wal-Mart and social capital – academic.oup.com [PDF]
- Effects of the existence and identity of major customers on supplier profitability: Is Wal‐Mart different? – meridian.allenpress.com [PDF]
- Job creation or destruction? Labor market effects of Wal-Mart expansion – www.mitpressjournals.org [PDF]
- The new Wal-Mart effect: The role of private contacting in global governance – heinonline.org [PDF]
- Analyzing the impact of Wal-Mart supercenters on local food store sales – academic.oup.com [PDF]
- Institutional and economic determinants of transnational retailer expansion and performance: a comparative analysis of Wal-Mart and Carrefour – journals.sagepub.com [PDF]
