The Impact of Wal-Mart on Income and Unemployment Differentials in Alabama
Using Alabama county data from 1980 and 1990 censuses and store opening dates, this paper presents an econometric study of the impact of the presence of Wal-Mart on black-white income and unemployment differentials. It is posited that Wal-Mart changes the competitive nature of the labor market in a way that is beneficial to blacks. After establishing a list of demographic and economic variables that affect unemployment and income, the impact of a Wal-Mart is tested by using a dummy variable and a cumulative-years variable. Wal-Mart is found to have substantially lowered the relative unemployment rates of blacks in those counties where it is present, but to have had only a limited impact on relative incomes after the influences of other social-economic variables are taken into account.
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