if and when China decides to stop exporting the “glut of global savings”?
The Walmart Effect was the claim (accepted pretty broadly as having a decent empirical basis, even given the disputes) that Walmart, by lowering prices at the downmarket end of things, added significantly to American spending power and standard of living. And particularly to consumers at the lower end of the economic scale. The Walmart Effect was partly Walmart stores themselves, but also the knock-on effects on the competition. Even if one accepted the effect, the size of its contribution to American consumption power was argued. And the extent to which it offset the losses to workers and wages was also hotly debated.
Charles Fishman set out the basic claims in his The Walmart Effect. But in many ways the thesis took on a whole different life when it was partly endorsed by Democratic economist Jason Furman, in a well-known essay. As described by the Washington Post website whorunsgov.com:
[H]e also praised Wal-Mart in a report that liberals still fiercely decry. Furman defended the discount super-store, calling it a