Wal-Mart ReVolution: How Big Box Stores Benefit Consumers, Workers, and the Economy

Wal-Mart ReVolution: How Big Box Stores Benefit Consumers, Workers, and the Economy

by Richard Vedder, Wendell Cox

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Overview

The activities of Wal-Mart and other big-box retailers have become rallying cries for both sides of the political aisle. This book is aimed at those involved in debates over Wal-Mart's impact on worker wages, labor issues, and health-insurance and land-use policies. The Wal-Mart Revolution provides useful facts about the company, the U.S. retail industry, labor economics, health-care policy, and land-use realities in America today. Economist Richard Vedder and public-private partnerships expert Wendell Cox painstakingly analyze available evidence before concluding that the economic transformation in American retailing which is personified by Wal-Mart has largely been good for Americans and the economy. Wal-Mart's basic business strategies have had a profoundly positive impact on America's productivity, wages, consumer prices, and other key economic variables. Though the book was written without any cooperation from Wal-Mart, Vedder and Cox address several criticisms often lobbed at the company and demolish them one-by-one: • Wal-Mart workers are paid fairly—given their level of skills and experience, and compared to other retail firms, Wal-Mart employees do well • Wal-Mart's fringe benefits—health-care coverage, retirement benefits, and more-—are similar to those of other retail firms, and very few Wal-Mart workers go without health insurance • Big boxes mean big business: communities with new Wal-Mart stores typically enjoy increased employment and incomes after the store opens • Wal-Mart benefits the poor, in particular, in the form of lower prices and new job opportunities • Attempts to keep Wal-Mart out of communities through zoning restrictions, mandatory health insurance, or special high minimum wages hurt citizens, especially those with lower incomes

Product Details

ISBN-13: 9780844742441
Publisher: Aei Press
Publication date: 01/25/2007
Pages: 175
Product dimensions: 6.10(w) x 9.05(h) x 0.76(d)

About the Author

Richard Vedder is a visiting scholar at AEI, and director of the Center for College Affordability and Productivity in Washington, D.C. Wendell Cox is an international public policy consultant and principal of Wendell Cox Consultancy (Demographia).

Table of Contents


List of Illustrations     xi
Preface     xiv
Introduction: Wal-Mart and the Big-Box Discount Store Revolution     1
Wal-Mart and Its Imitators; Saints or Sinners?     2
The Genesis of the Big-Box Revolution     3
The Economic Impact of Wal-Mart and Other Big-Box Stores     4
What Should We Do About Wal-Mart?     6
Why Wal-Mart Matters     9
The Importance of Retail Innovations     10
The Economic Importance of Retail Trade     11
The Discount Revolution and Consumer Surplus     13
The Supply Side     19
Spillover Effects, or "Externalities"     20
Public Attitudes Concerning Retail Trade in America     22
Conclusions     23
Wal-Mart and Its Critics     24
The Criticisms     25
The Intensity of the Rhetoric     27
Who Are the Critics?     31
Tactics of Wal-Mart's Critics: Litigation and Legislative Changes     32
Conclusions     34
The Wal-Mart Revolution     35
A History of Retail Innovation in America before Wal-Mart     36
Retailing in America before Wal-Mart     36
Retailing at the Beginning of the Discount Age     42
Conclusions     44
The Wal-Mart Story     46
Retail Trade Growth Since 1965: An Overview     46
Sam Walton     50
The Growth of Wal-Mart     53
Conclusions     65
Limitators and Innovators     67
The Rise of Big-Box Stores: Wal-Mart's Competitors     67
Discount Department Stores and Supercenters     70
Membership Warehouses     73
Specialty Big-Box Stores: Home Improvement     74
Specialty Retailers Consumer Electronics     76
Specialty Stores Office Supplies     78
Other Specialty Operators     79
The Next Generation of Retailing?     80
Conclusions     81
Wal-Mart: Good or Bad?     83
Employment and Wage Effects of Discount Stores     84
Employment in Retail Trade     85
Employment Effects of Wal-Mart     87
Are Wal-Mart Workers Underpaid?     91
Fringe Benefits     96
Conclusions     98
Competition and Communities     100
Some Analysis of Store Openings     100
Findings of Other Scholarly Researchers     107
Wal-Mart and Its Suppliers      114
Conclusions     115
Wal-Mart and the Poor     117
Wal-Mart's Customers     117
Implications for Policy     121
Wal-Mart and Public Assistance     124
Conclusions     125
The Discount Revolution in Broader Economic Context     126
Estimating Broader Economic Effects: Some Issues     126
The Big-Box Discount Revolution and Productivity Change     128
Broader Economic Effects: Social Savings of Modern Discount Stores     134
Conclusions     136
The Future of Wal-Mart     137
Wal-Mart and the World     138
The Rise of Big-Box Stores in Europe     138
International Big-Box Firms     141
International Big-Box Specialty Stores     144
International Purchasing by Big-Box Operators     145
International Labor Standards: Better Life or More Poverty?     149
Conclusions     150
Critiquing the Critics     151
Assessing the Criticisms of Wal-Mart and Other Big-Box Discounters     152
Conclusions     160
What Should We Do About Wal-Mart?     161
Policies Relating to Employee Relations     161
Wal-Mart's Impact on Communities and the Environment     167
Policies Regarding Globalization and Overseas Worker Standards     170
Should Wal-Mart Enter Banking?     171
The Other Side of the Coin: Subsidizing Wal-Mart or Other Stores     171
Leveling the Playing Field: Stop Subsidizing Wal-Mart's Critics     172
Appeasing the Unappeasable: Wal-Mart's Public Relations Campaign     173
The Future of Wal-Mart and Other Big-Box Discounters     176
Conclusions     179
Notes     181
Index     201
About the Authors     209

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