Is shopping at WalMart a normal or inferior good Is shopping at Kohls a normal or inferior good

1
Is shopping at Wal-Mart a normal or inferior
good?Is shopping at Kohls a normal or inferior
good

• What should happen to their stock prices in a
  recession?

2
Is Wal-Mart Recession Proof?WalMart caters to
low price items. Customers switch to WalMart as
their incomes fall, and so WalMart sales behave
like an inferior good.Kohls specializes in
branded items that cost more. Customers switch
toward Kohls as their incomes increase, and so
Kohls sales behave like a normal good.
3

• December 2008 Sales relative to Same Stores, 2007
• Abercrombie and Fitch -18
• Costco 4
• Gap -14
• Kohls -1.4
• Macys -4
• Neiman Marcus -28
• Saks -19
• Target -4
• WalMart 1.9

4
WalMart
Start of recession
Kohls
5
Wal-Mart Stock Price, 1999-2008
Start of a recession
Kohls Stock Price, 1999-2008
http//online.wsj.com/quotes/stock_charting.html
6
Wal-Mart Stock Price, 1999-2008
Start of a recession
Kohls Stock Price, 1999-2008
http//online.wsj.com/quotes/stock_charting.html