TY  - JOUR
AU  - Neumark,David
AU  - Zhang,Junfu
AU  - Ciccarella,Stephen
TI  - The Effects of Wal-Mart on Local Labor Markets
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 11782
PY  - 2005
Y2  - November 2005
UR  - http://www.nber.org/papers/w11782
L1  - http://www.nber.org/papers/w11782.pdf
N1  - Author contact info:
David Neumark
Department of Economics
University of California at Irvine
3151 Social Science Plaza
Irvine, CA  92697
Tel: 949-824-8496
Fax: 949/824-2182
E-Mail: dneumark@uci.edu

Junfu Zhang
Department of Economics
Clark University
Worcester, MA  01610
Tel: 508-793-7247
E-Mail: juzhang@clarku.edu

Stephen Ciccarella
Public Policy Institute of California
500 Washington Street, Suite 800
San Francisco, CA 94111
E-Mail: ciccarella@ppic.org
AB  - We estimate the effects of Wal-Mart stores on county-level retail employment and earnings, accounting for endogeneity of the location and timing of Wal-Mart openings that most likely biases the evidence against finding adverse effects of Wal-Mart stores.  We address the endogeneity problem using a natural instrumental variables approach that arises from the geographic and time pattern of the opening of Wal-Mart stores, which slowly spread out from the first stores in Arkansas.  The employment results indicate that a Wal-Mart store opening reduces county-level retail employment by about 150 workers, implying that each Wal-Mart worker replaces approximately 1.4 retail workers.  This represents a 2.7 percent reduction in average retail employment.  The payroll results indicate that Wal-Mart store openings lead to declines in county-level retail earnings of about $1.4 million, or 1.5 percent.  Of course, these effects occurred against a backdrop of rising retail employment, and only imply lower retail employment growth than would have occurred absent the effects of Wal-Mart.
ER  -