The Hometown Advantage

Stacy Mitchell is a researcher for the Institute for Local Self Reliance and the author of "The Hometown Advantage." In her book she explores the trend toward a chain store economy and why that might not be the best thing for communities.

There is a perception that giant chains offer more convenience, wider selection, better service, and lower prices. It is assumed that chains create jobs and generate additional tax revenues. Economic development policy that offers incentives and grants and builds infrastructure to attract chains is based on these assumptions. When we look past the assumptions we discover that the public costs may outweigh the gains.

Chains have a place in the economy but does it make sense to use our tax dollars to give large corporations an advantage over locally-owned, independents?

Large chains reduce retail diversity. Reduced competition leaves the consumer at the mercy of absentee-owned companies that can raise prices or abandon the community.

Stacy Mitchell points out , "Local businesses enrich the civic fabric. Small merchants care about their communities more because they are part of those communities. The taxes they pay provide services, like schools and police and parks, that they and their families use. Small merchants give to community causes more than their big competitors. Their purchases and profits tend to circulate within and strengthen the local economy rather than flowing to distant suppliers or corporate headquarters."