Is Wal-Mart a Poverty Fighter?

A recent New York Times published a column by John Tierney (requires subscription) that’s begging for some discussion. Not wishing to take anything away from Muhammad Yunus and the Grameen Bank, winners of this year’s Nobel Peace Prize, Tierney argued that Wal-Mart had done more than any other organization to lift people out of poverty.

Wal-Mart uses suppliers from around the developing world, and they employ lots of people - perhaps millions - at wages that can be relatively high in their countries. Citing a study by two researchers from San Jose State University, Tierney wrote: “In Honduras, the economists note, the average apparel worker makes $13 a day, while nearly half the population makes less than $2 a day.”

Tierney also pointed out that while Wal-Mart may put some American shopowners out of business, it benefits American consumers by offering low prices on a wide range of goods. He didn’t mention that many of the world’s poorest people don’t have access to the kinds of jobs Wal-Mart’s suppliers offer. But still, is this really the best possible, win-win model for economic development?

Source: International Herald Tribune Blog