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Mom-and-Pop Meet Big Box: Complements or Substitutes?

46 Pages Posted: 22 Oct 2009  

John Haltiwanger

University of Maryland - Department of Economics; National Bureau of Economic Research (NBER); Institute for the Study of Labor (IZA)

Ron S. Jarmin

U.S. Census Bureau

C. J. Krizan

Government of the United States of America - Bureau of the Census

Multiple version iconThere are 2 versions of this paper

Date Written: September 1, 2009

Abstract

In part due to the popular perception that Big-Boxes displace smaller, often family owned (a.k.a. Mom-and-Pop) retail establishments, several empirical studies have examined the evidence on how Big-Boxes’ impact local retail employment but no clear consensus has emerged. To help shed light on this debate, we exploit establishment-level data with detailed location information from a single metropolitan area to quantify the impact of Big-Box store entry and growth on nearby single unit and local chain stores. We incorporate a rich set of controls for local retail market conditions as well as whether or not the Big-Boxes are in the same sector as the smaller stores. We find a substantial negative impact of Big-Box entry and growth on the employment growth at both single unit and especially smaller chain stores – but only when the Big-Box activity is both in the immediate area and in the same detailed industry.

Keywords: Big-Boxes, Small Business, Retail Trade, Firm Location, Structural Change

JEL Classification: R30, L16

Suggested Citation

Haltiwanger, John and Jarmin, Ron S. and Krizan, C. J., Mom-and-Pop Meet Big Box: Complements or Substitutes? (September 1, 2009). US Census Bureau Center for Economic Studies Paper No. CES-WP- 09-34. Available at SSRN: https://ssrn.com/abstract=1491529 or http://dx.doi.org/10.2139/ssrn.1491529

John C. Haltiwanger

University of Maryland - Department of Economics ( email )

College Park, MD 20742
United States
301-405-3504 (Phone)
301-405-3542 (Fax)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Institute for the Study of Labor (IZA) ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Ron S. Jarmin

U.S. Census Bureau ( email )

4700 Silver Hill Road
Washington, DC 20233
United States

C. J. Krizan (Contact Author)

Government of the United States of America - Bureau of the Census ( email )

Suitland Federal Center
Washington, DC 20233
United States

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