Product Market Competition and Human Resource Practices in the Retail Food Sector

Matthew Freedman, Cornell University
Elizabeth Davis, University of Minnesota
Julia Lane, National Science Foundation
Brian McCall, University of Michigan
Nicole Nestoriak, Bureau of Economic Analysis
Timothy Park, University of Georgia

Abstract

In the wake of Wal-Mart and other mass merchandisers’ entry into food retailing, the nature of competition in the industry has changed radically. Using longitudinal data on workers and firms to construct measures of compensation and churning for traditional food retailers, this paper examines how these measures change in response to mass merchandiser entry. While there is considerable heterogeneity across retail food establishments, human resource practices are persistent even in the face of new external competition.