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New Rules Project -Retail -"The Hometown Advantage -Big Box and Wal-Mart Econom... Page 6 of 11 <br /> bieion. The study also compares health insurance <br /> benetib at unionized supermarkets and WaFMart, <br /> and examines the tax and revenue implica5ons of <br /> supercenler development. <br /> L EXISTING BUSINESSES <br /> These studies look at how the enNal of a big-box retailer tlisplaces <br /> sales at existlng busMassea, which must Men downsiZe or dose. <br /> resuldnp In job losses end dedining tax revenue. <br /> The Impact of'Big-Box' Building Materials Stores on Host <br /> Towns and Surrounding Counties in a Midwestern State - by <br /> Economics Prorassor KenneM E. Stone and Extension Program <br /> Spedalisl Georgeanna M. Artz, Iowa State University, 2001. <br /> This study examines several Iowa communities <br /> where big box bu0ding supply stores, such es <br /> Menards and Home Depot, have opened b the last <br /> decade. Sales of hardware end building supplies in <br /> Me host community and surrounding counfles are <br /> backed over several years to test what the auMors <br /> cog Me "zero-sum-game theory,' namey Mat the <br /> retafi salsa gains generated by big box stores are <br /> offset by sales losses at existlng, often bcatly <br /> owned, rethtl stores. Tha results conflrtn the theory, <br /> flndkg that sales of hardware and buiMktg supplies <br /> grow in Me' host tommtmitlea, but at the experrae of <br /> sales k smatler towns nearby. Moreover, albr a <br /> few years, marry of the host communites <br /> experienced a reversal of fortune: sales of <br /> hardware and brdldkg supplies declined sharpy, <br /> open dropping below Mek mitlal levels, as more big <br /> box siorea opened in the surtounding region end <br /> saturated the market <br /> What Happened When We4MaR Cams to Town9 A Report on <br /> Thee Iowa CommundMS wdh a Stafkdgl Anaysb oT Sewn <br /> Iowa Countlp - by Thomas Muller arM EllzebeM Humslone, <br /> Natbnai Trust for Hialork Preservatlon, 1996. <br /> This sWdy examined Me hoped of Wal-Mart ar <br /> severel Iowa cwrrmunitles. tt found Mat 84 percent <br /> of a1 sobs at Me new Wa~Mart stores nma at Me <br /> experue of existlrq businesses wtthin the same <br /> count'. Any is percent of sales came from outside <br /> Me eourrty-a fiMhq whirh refutes Me notlon Mat <br /> Wet-Mart can aG a3 a magnet drawktg asibmefa <br /> from a wide area and baneming other Duskteasea b <br /> toxm.'Atthotgh some suggest Mat the presence of <br /> Wa4Mert otrlsbe of, lkrt near to, the downtown <br /> <br /> ' area resufis in adtlitlonal aotlvity downtown, both <br /> setae data and ba11k date do not show thb gain,' <br /> the shxy conWrdos. "None of fire nine see studies <br /> was experiendnp a Idph enough bvel of populetlon <br /> and klcorrte growth to absorb the Wal-Mah afore <br /> wtlhotd losses b oMer busineaaea.' The attby <br /> doarments bases in downtown stores after WaF <br /> Marl opened. "General merchandise stores were <br /> moat afkded; the study notes. "Other types of <br /> stores Mal riosetl kdude: automotive stores, <br /> hardware stores, clop stores, apparel stores, an0 <br /> sporgng goods stares.' The supposed tax benefits <br /> of Wal-MeA dk not materlalisa ehher:'ABhough Me <br /> kxxl tax bass added about E2 milfion wtlh each <br /> WaMAart, Me dedhre in retefi stores fofiowing Me <br /> opeMng had a depressing effect on property values <br /> in dowmowns and on shopping stops, oflseWng <br /> gains from Me Wa4Mart property." <br /> Compedng wtth the Dbeount Masa Merehandisers - By a. <br /> Kenneth Slone, kxwa State University, 1995 <br /> The bask premise of this sWdy and othere by Ken <br /> stone Y Mat Me retatl "pb' b remtnrey fixed m size <br /> (k grows ony ktaemantaly as populatlon and <br /> ktcomes grow)- Consequently, when a tangent' <br /> http://www.newrules.org/retaiUeconimpact.html 9/5/2007 <br /> <br />