Tuesday, November 24, 2015
Ali Hortacsu (Chicago) and Chad Syverson (Chicago) explain The Ongoing Evolution of US Retail: A Format Tug-of-War.
ABSTRACT: The past 15–20 years have seen substantial and visible changes in the way US retail business is conducted, with many formerly dominant companies and formats in the sector—for example, Sears, Radio Shack, JCPenney, Circuit City, and a number of shopping malls—struggling to adjust and sometimes suffering fatal blows. Some parts of retail, like traditional department stores as well as book and music stores, have seen large declines in sales and employment. Explanations about what is happening in the retail sector have been dominated by two powerful and not fully consistent narratives: a prediction that retail sales will migrate online and physical retail will be virtually extinguished, and a prediction that future shoppers will almost all be heading to giant physical stores like warehouse clubs and supercenters.