Related Blog Entry I: KiHuk`s Walmart`s Place Issue

Making reference to KiHuk`s post and his article about Walmart`s place issue. The market had placed Walmart as one of the biggest business in the world. The announcement of the opening of a Wal-mart superstore in a New York Neighborhood, Queens, has created a lot of agitation. Labor movement sees, small businesses, city officials are getting together against it, and the store is already becoming an issue in this year's mayoral campaign. The city has more than a dozen discount stores already, so one could ask why not Walmart? Wouldn’t it help leverage pricing among them by adding a competitor? Isn’t it the fundamental principle of perfect competition?

Believe it or not, American business has been through this before. The Great Atlantic & Pacific Tea Co., the grocery-store chain, was dominating the U.S. market in the 1920s and 1930s with a dominance that has likely never been duplicated. At its peak, A&P had five times the number of stores Wal-Mart has now (although much smaller ones) and owned 80% of the supermarket business. Some of the antipredatory-pricing laws in use today were inspired by A&P's attempts to muscle its suppliers.

By reading the interview of Ray Bracy, Wal-Mart's vice president for federal and international public affairs, one can understand that the battle will be extremely difficult against one of the biggest company on earth.