Creative Destruction? Impact of E-Commerce on the Retail Sector / Sudheer Chava, Alexander Oettl, Manpreet Singh, Linghang Zeng.

Format:

Book

Author/Creator:

Chava, Sudheer.

Contributor:

National Bureau of Economic Research.

Oettl, Alexander.

Singh, Manpreet.

Zeng, Linghang.

Series:

Working Paper Series (National Bureau of Economic Research) no. w30077.

NBER working paper series no. w30077

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2022.

Summary:

Using an administrative payroll dataset for 2.6 million retail workers, we find that the staggered rollout of a major e-commerce firm's fulfillment centers reduces traditional retail workers' income in geographically proximate counties by 2.4%. Wages of hourly workers, especially part-time hourly workers, decrease significantly, driven by a drop in the number of hours worked. We observe a U-shaped pattern in which both young and old workers experience a sharper decrease in wage income. Consequently, some workers experience an increase in credit card delinquency. Using data for 3.2 million stores, we find that sales (employment) at proximate stores decrease by 4% (2.1%). Exits, especially of young and small stores, increase, and entry decreases. In aggregate, the retail sector loses 938 jobs per county per quarter, and the transportation-warehousing sector (food services sector) gains 256 (143) jobs. Our results highlight how creative destruction led by e-commerce impacts local labor markets.

Notes:

Print version record

May 2022.