CALIFORNIA POLITICS & POLICY

Vol. 7, No. 1, June, 2003

WHY THERE WILL BE NO CHAIN

SUPERMARKETS IN POOR INNER-CITY

NEIGHBORHOODS

TOM LARSON

Department of Economics and Statistics

California State University, Los Angeles

 

This study first describes why having full-service grocery stores is important in neighborhoods. Stores are not needed just for shopping convenience; they also affect the nutrition and health of a neighborhood, provide jobs, and increase the central city’s tax base. Next is a brief summary of alternative views on rebuilding inner cities. The scarcity of major chain supermarkets in inner cities is explained via a review of the economic literature on the modern supermarket industry. Then, the viability of independent, full-service grocery stores in inner cities is examined through a review of food pricing surveys. The ability of independents to compete with major chain stores in low-income neighborhoods in Los Angeles is supported by the results of an original survey of grocery store prices in Los Angeles. The study concludes with suggestions for new strategies for bringing supermarkets to inner cities.

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