Munich Personal RePEc Archive

Business Practices of Wal-Mart in Northwest Indiana

Rao, Surekha and O'Dell, CYnthia (2007): Business Practices of Wal-Mart in Northwest Indiana. Forthcoming in: International Journal of Business and Economic Perspectives (2008)


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Wal-Mart symbolizes the strength of economic and commercial activity in any region. Wal-Mart has built a business empire on its low-cost model. Customers love Wal-Mart stores for its low prices. At the same time, Wal-Mart is under a barrage of criticism for labor practices and indirect burdens on our social and welfare programs. Some of the business practices of Wal-Mart like the employees’ wage-benefits package, and the underemployment of women and minorities are the subject of ongoing debate at the national level. Our main objective is to review this issue within a regional context. We examined whether what is being alleged about the business practices of Wal-Mart at the national level is mirrored at the regional level, like northwest Indiana. The findings presented are from a survey designed to analyze the impact of the business practices of Wal-Mart on customers and employees. Our results concur with earlier national studies that there are hidden costs for the community which shops and supports Wal-Mart and that a large number of employees are older, work part time, earn below the regional average income, and depend on state welfare programs. We found gender differences in employment, earnings, and career advancement opportunities. The price of low cost goods may be too high for the region economy and it will likely affect women more than men.

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