Impact of Wal-Mart on the US Economy Essay -- Business Economics

Impact of Wal-Mart on the US Economy Wal-Mart has had a significant economic impact on the US, as well as the economies of countries that have relations with the US. Wal-Mart is the world’s biggest company of any kind, with 80 percent of the households in America purchasing something from the superstore; it is the nation’s largest retailer. Wal-Mart’s continuing price reduction has given Americans the advantage of being able to afford 15 to 20 percent more than they previously could. (Hansen) In a world governed by globalization and greed, competition has become rigid; as a result firms like Wal-Mart have utilized advanced marketing strategies to insure that they are on the ‘neck’ of competition, and are the core deciders of the market. (Ortega) However, Wal-Mart made decisions that were of a disadvantage to aspects of the economy, including the depletion on a small scale of Small Town USA. Wal-Mart has been of a great advantage to the US economy, being the world’s largest private employer thus providing more jobs. Wal-Mart is currently employing 1.5 million which equals to the population of 12 states. In addition, Wal-Mart has caused the lowering of prices of competitors known as the ‘Wal-Mart effect’, this saved Americans approximately $100 billion in 2002. (Hansen) On a smaller degree, this caused an individual American to save 15 to 20 percent of their income on necessities, allowing the surplus to be utilized in a fashion that allows an expenditure which fulfills a specific luxury to the individual, for example a car etc.. From my point of view, this allows the less advantaged to be able to purchase beyond necessities, and causing more money to spread through the market rather than the recycl... ...al-Mart’s methods to keeping these prices down have been immoral. In addition, they have taken advantage of town resources for example, subsidies, employee benefits and exploitation of cheap labor. Even though they have surpassed significantly in attracting customers all over the nation, they failed to do so ethically. This has created losses to competitors, and the battle for profit is an ongoing one. Therefore, I believe that Wal-Mart has become an economical disaster to competitors and the US as a whole. This is due to the exporting of huge amounts of funds to Asian countries, which in turn reduced the funds in the US due to continuous import costs. Works Cited: Hansen, Brian. "Big-Box Stores." Are They Good For America? 14 (2004). 14 Mar 2005 <www.libraries.psu.edu/cqresearcher>. Ortega, Bob. "Ban the Bargains." The Wall Street journal 11 Oct 1994.