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Abstract

This study examines the effects of big - box stores on the change in the number of retail stores operating in a market area. Our econometric results suggest that the presence and growth of big - box retailers has a positive net effect on retail establishment growth in Maine. We found no evidence that big - box stores have any impact on the net change in hardware stores, but did find a positive impact on the net change in the number of restaurants. An additional noteworthy finding of this study is that there appears to be a “saturation point” at which the effect of an additional big - box store becomes negative, a likely result of too much competition in a community’s overall retail sector.

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