Today sees the publication of a report from the think-tank Demos which argues that supermarkets should be seen as an intergral part of creating the so-called ‘Big Society’. The report’s author said:

“[The supermarkets] have a role to play in helping deprived communities to regenerate by reducing stigma, boosting community morale and bringing low-cost quality produce into the area. It’s easy to be cynical about mainstream retail chains, but they can be the game-changer for transforming perceptions within and outside rundown neighbourhoods.”

The only problem being that, in the USA at least, supermarkets have been linked with a decline in civic life and the closure of those very institutions that the Big Society claims to promote.

When two economists, Stephan Goetz and Anil Rupasingha, carried out a detailed study [1] in the US of the links between Wal-Mart and “social capital” – the community cohesion and mutual support that makes neighbourhoods work – they were astonished to find that the presence of a Wal-Mart nearby brought the voting turn-out down.

Other measures of social capital went down too. They found that communities that gained a Wal-Mart during the decade had fewer local charities and local associations such as churches, campaign and business groups per capita than those that did not. But why?

It seems that by crushing smaller businesses and losing the local knowledge and relationships they embody, the supermarket economic model – used by its UK subsidiary Asda, and widely copied by rivals such as Tesco – cuts the threads that hold an engaged community together. Big supermarkets, often lured by grants into regeneration areas, have not acted as useful anchors but instead have competed, often unfairly, with the surrounding businesses – sucking money out of the local economy.

Governments have mistaken being “big business-friendly” with being pro-enterprise. And supermarkets have not only killed the rich diversity of producers, suppliers and shops that are essential to a resilient economy, they are also dissolving the glue that holds communities together.

____________________________

[1] Stephan J. Goetz and Anil Rupasingha (2006) ‘Wal-mart and social capital’, American Journal of Agricultural Economics, Vol 88, No 5.

About these ads