NCPA - National Center for Policy Analysis

Supercenter Ban Harms Consumers

March 22, 2004

California has become the main battleground over so-called "big box" retail centers. Referenda on whether or not to ban giant retailer Wal-Mart are popping up on ballots in various areas, including Inglewood, San Marcos and Contra Costa County.

Yet supercenter prohibitions arguably penalize low-income consumers, say observers:

  • A year ago, a Wal-Mart store became a long-sought anchor for a fading regional mall in a south Los Angeles community torn by 1992 riots; residents no longer had to depend on mom-and-pops or long trips to find low prices, and the store provided more than 300 badly needed jobs.
  • A city council proposal to ban big-box stores that sell groceries is short-sighted, say observers; what may make sense in the overdeveloped San Fernando Valley and west Los Angeles may not make sense in underdeveloped south Los Angeles.
  • A study by the Los Angeles County Economic Development Corp., a coalition of groups promoting new business, found shoppers usually pay 20 percent less at supercenters than at union supermarkets.

Roger Blackwell, an Ohio State University marketing professor has his own take on Wal-Mart bashing: "People who want to hang onto the past are fighting the innovations Wal-Mart brings to the marketplace."

Still, for every place that snubs Wal-Mart, plenty of others embrace it. "We'd welcome a supercenter," says Terrence Grindall, economic development manager in Manteca, a city of 60,000 near Turlock, whose supercenter ban triggered a lawsuit. "We're pro-business."

Source: John Ritter, "California Tries to Slam Lid on Big-boxed Wal-Mart," USA Today, March 2, 2004.

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