Wal-mart and mom-and-pop

I've previously discussed with skepticism the arguments against Wal-Mart. One of the most persistent is that Wal-Mart hurts small businesses. Now there's new evidence against this proposition, Sobel & Dean, Has Wal-Mart Buried Mom and Pop?: The Impact of Wal-Mart on Self Employment and Small Establishments in the United States. Here's the abstract:

This paper explores the widely-accepted view that Wal-Mart causes significant harm to the traditional, small 'mom and pop' business sector of the U.S. economy. We present the first rigorous econometric investigation of this issue by examining the rate of self-employment and the number of small-employer establishments using both time-series and cross-sectional data. We also examine alternative measures and empirical techniques for robustness. Contrary to popular belief, our results suggest that the process of creative destruction unleashed by Wal-Mart has had no statistically significant long-run impact on the overall size and profitability of the small business sector in the United States.

And more from the conclusion:

While the entry of a specific Wal-Mart store might cause some individual small, ‘mom and pop’ businesses to fail, our results suggest that these failures are completely offset by the entry of other new small businesses somewhere else in the economy. * * *

Anecdotal evidence suggests that this reallocation allows an opportunity for new entrepreneurial ventures, such as coffee shops, art galleries, and high-end restaurants, to emerge. Prior to Wal-Mart these types of firms were at a significant disadvantage in competing for the high-valued downtown retail space occupied by general merchandisers who fail when Wal-Mart comes to town. While the total number of small businesses is unaffected, due to new firms replacing old ones, a possible criticism is that ‘good’ small businesses are replaced by ‘worse’ small businesses that generate less income for their owners. However, we can find no evidence consistent with this claim either. Average real revenue and net income for small businesses continued to grow substantially throughout the entire period in which new small businesses replaced the old ones who failed. * * *

[T]he results of our study suggest that claims about harm to the small business sector are statistically unfounded, and should be given no weight in future political and court decisions regarding openings of new Wal-Mart stores.