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Superstores and Labour Demand: Evidence from Great Britain

The objective of this paper is to quantify the net effect that the massive opening of edge or out-of-town superstores, which took place in Great Britain in the mid-eighties and early nineties, had on local employment. Our data set consists of the location and the opening dates of Tesco and Sainsbury's stores, in combination with Census of Employment data from 1984 to 1991. Using both a fixed-effects specification and a system-GMM specification which allows to control for endogeneity, we find that in spite of the adverse effects they had on competing smaller stores, superstores had an overall positive net effect on employment.