Power and Poverty: The Distributional Consequences of Walmart Supercenter Openings

With Lukas Lehner, Zachary Parolin and Clemente Pignatti.

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We use restricted-access Panel Study of Income Dynamics data from 1970-2019 to study how Walmart Supercenter openings affect poverty, tax liabilities, and receipt of income transfers. Using a stacked difference-in-differences approach, we find that the opening of a Supercenter leads to a 2 percentage point (16%) increase in poverty, channeled through declining annual earnings. Increases in poverty are largest for younger and less-educated adults, and for adults with lower pre-treatment incomes. Supercenter openings lead to a $200 (16%) per household per year increase in government income transfers received, and a $920 (5%) per household per year decrease in tax revenues.