The Locational Impact of Wal-Mart Entrance: A Panel Study of the Retail Trade Sector in West Virginia
This paper examines the retail trade sector in 14 West Virginia counties from 1989 through 1996. A series of random effects models are tested on these panel data to measure the effect of the entrance of Wal- Mart stores in the county and in adjacent counties, and business cycle effects. This paper differs from earlier research in that it controls for endogeneity in the entrance decision of Wal-Mart in faster growing counties. This research finds a dramatic net increase in employment and wages in the Retail Trade sector (SIC 52) and a mild increase in the number of firms. The study finds a per capita wage increase in this industry, which is surprising but small. The paper concludes with further research recommendations.
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