[Vision2020] Wal-Mart Equals Higher Poverty Rates

Sun May 21 20:06:23 PDT 2006

Re: [Vision2020] Wal-Mart Equals Higher Poverty RatesMoscow can be anywhere
on the bell curve it wants.  A Wal-Mart supercenter is in Scottsdale, AZ.
Wal-Mart had to shift from its status quo model to do so.  Any community can
set standards for which Wal-Mart would be considered acceptable.  To dismiss
Wal-Mart because of its past business model is not being proactive.  Any dog
can learn new tricks.  Set the parameters and see if Wal-Mart steps up to
the plate.  If it's not willing, then it can take a hike.  Maybe that's
already been done?  Or maybe Wal-mart is just not wanted or needed in
Moscow.

Mark
  -----Original Message-----
  From: vision2020-bounces at moscow.com
[mailto:vision2020-bounces at moscow.com]On Behalf Of Mark Solomon
  Sent: Sunday, May 21, 2006 4:58 PM
  To: Jerry Weitz; vision2020 at moscow.com
  Subject: Re: [Vision2020] Wal-Mart Equals Higher Poverty Rates

  Thanks, Jerry, for the model review. As you rightly point out, any general
study's conclusions have to be treated with a grain of salt when applied to
a specific, in this case, local situation. However, that does not diminish
the study's general conclusion that was derived using data related to all
(about 3000 at the time of the study) Walmart stores. The authors note:

  Wal-Mart avoids counties with higher population density (at least until
recently) in part
  because of higher land costs in these counties, and while the chain has
traditionally located in
  rural communities, it also avoids less populated, more remote places.

  The above appears to describe Latah County, and Moscow in particular,
fairly well. We may not be in the center of the study's Bell curve, but I
bet we're not too far off to either side.

  Mark

  At 4:22 PM -0700 5/21/06, Jerry Weitz wrote:
    I reviewed the Wal-Mart and County-Wide Poverty and was impressed that
they used a two stage regression model that we use in Medicine/dentistry for
epidemiological studies with multivariates.  Briefly and I am not an expert,
the first stage (an unstructured polytomous logistic regression approach)
models the effects of covariates that can be defined by
cross-classifications.  The second stage (the subtype-specific regression
parameters of the first stage model) are modeled by using  the multivariate
structure of the subtype definitions and the possible ordering of continuous
naturing of certain characteristics.  Thus the second stage modeling reduces
dimensional biases.  The complexity of variables in economics causes a study
such as this to be suspect and the authors conclusions kind of let them off
the hook in that "Wal-Mart creates both benefits and costs to communities."
So if there are omitted variables and a spacial dependence bias, then at
least  two stage modeling methodology can be efficiently corrected.  What
was missing for our region was the effect of large government programs such
as CRP: CRP effects on small ag business such as repair shops, farm supply,
equipment dealerships, fertilizer companies, land value and sales etc.
Other variates such as having a large student population relative the
general population,  a declining forest industry, relative lack of large
private sector businesses may be variates that would require future inquiry.

    From my world  examples:  PSA for Prostate Cancer Screening.  Recall
that "an epidimic of prostate cancer" occured in the media since PSA
introduction.  However the question is:  would have Noble Laureate Linus
Pauling who died at 93 with prostate cancer would have lived longer with
therapies administered to him with a PSA test at age 60 or would the
therapies caused him to die earlier?   Another, would CT for lung cancer
screening for Peter Jennings who died at 67 caused him to live longer?
Presently U. S. Preventive Services Task Force states "current data do not
support screening for lung cancer with any method."   Or another drug study:
Bextra (cox-2inhibitor) where the contol proved to be flawed yet the
compaarative study was not flawed.  The drug was thrown out of the market.

    Hence studies are easlily biased and can lead to bad
information/actions.  The question to be answered:  Would it be in the
interest of Moscow to have commercial development shift to the corridor?
Would this help or hinder the school district revenues since the district
has now stabilized enrollment after significant ADA declines from the mid
90's. jerry

    At 03:32 PM 5/17/06, Mark Solomon wrote:

       Social Science Quarterly Publishes Study: Wal-Mart Equals Higher
Poverty Rates

      Study claims Wal-Mart raises poverty rates in the counties where its
stores are located.

      MALDEN, Mass./EWORLDWIRE/May 17, 2006 --- A study published in the
latest issue of Social Science Quarterly is the first to examine the effect
of Wal-Mart stores on poverty rates. The study found that nationwide an
estimated 20,000 families have fallen below the official poverty line as a
result of the chain's expansion.

      During the last decade, dependence on the food stamp program
nationwide increased by eight percent while in counties with Wal-Mart
stores, the increase was almost twice as large at 15.3 percent.

      "After controlling for other factors determining changes in the
poverty rate over time, we find that counties with more initial Wal-Mart
stores and with more additions of stores between 1987 and 1998 experienced
greater increases (or smaller decreases) in family poverty rates during the
1990's economic boom period," stated Stephan Goetz a professor of
Agricultural and Regional Economics at The Pennsylvania State University.
Although Wal-Mart employs many people living in its communities, for most,
the hours worked and the wages paid do not help these families transition
out of poverty.

      Another effect is that the closing of "mom and pop" stores following
the appearance of a store leads to the closing of local businesses that
previously supplied those stores including, wholesalers, transporters,
logistics providers, accountants, lawyers and others. Goetz states, "By
displacing the local class of entrepreneurs, the Wal-Mart chain also
destroys local leadership capacity." Social Science Quartely author's
encourage community leaders to think about programs and policies in
anticipation of helping those displaced by the arrival of the chain.

      This study is published in the June issue of Social Science Quarterly.
Media wishing to receive a PDF of this article please contact
journalnews at bos.blackwellpublishing.net.

      Connecting the Social Sciences, Social Science Quarterly is nationally
recognized as one of the top journals in the field. It is published on
behalf of the Southwestern Social Science Association.

      Dr. Stephan J. Goetz is a professor of Agricultural and Regional
Economics at The Pennsylvania State University. Before coming to Penn State
in 1999, he served on the faculty at the University of Kentucky for nine
years with research and teaching responsibilities in economic development.
Dr. Goetz is available for questions and interviews.

      Blackwell Publishing is the world's leading society publisher,
partnering with 665 academic and professional societies. Blackwell publishes
over 800 journals and, to date, has published more than 6,000 books, across
a wide range of academic, medical and professional subjects.

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