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Journal of Economic Geography Advance Access originally published online on May 4, 2007
Journal of Economic Geography 2007 7(4):471-490; doi:10.1093/jeg/lbm014
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© The Author (2007). Published by Oxford University Press. All rights reserved. For Permissions, please email: journals.permissions@oxfordjournals.org

Oligopoly and the structural paradox of retail TNCs: an assessment of Carrefour and Wal-Mart in Japan

Yuko Aoyama*

* Graduate School of Geography, Clark University, 950 Main Street, Worcester, MA 01610-1477, USA.

email < yaoyama{at}clarku.edu>

JEL classifications:: JEL classifications: L81, L13, N7

This research focuses on the case of international chains facing significant competition from domestic chains in advanced industrialized economies. In this article, I question the assumptions behind the perceived, simultaneous process of globalization and retail concentration by taking the cases of the world's two largest retailers, Wal-Mart and Carrefour, entering the Japanese market in the early 2000s. Both retail TNCs have so far failed to meet initial high expectations for their performance. I argue that there is a structural paradox inherent among retail TNCs, which is expressed as contradictory forces between standardization and localization. Empirical evidence is provided on how these forces complicate retail TNCs’ front-end (store-front) and back-end (distribution) operations in the case of Japan. Emphasis is placed on the role of oligopoly in the retail sector and how its absence affects retail TNCs’ operation in foreign markets.

Keywords: retail trade, oligopoly, Japan
Date submitted: 20 September 2006     Date accepted: 14 March 2007


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