Using publicly available data sources and data supplied by Wal-Mart, I estimate the impact of a proposed “big box living wage ordinance” on a new Wal-Mart store scheduled to open in Chicago in the spring of 2006. I find that an ordinance that mandates a $10.00 per hour minimum wage and a $3.00 per hour health care insurance benefit for stores of more than 75,000 square feet would lead to an approximately 15.3 percent increase in labor cost for an average Chicago “big box” retailer. I estimate that, if the entire cost of the mandate were passed on to consumers through price increases, this could be recovered through an approximately 2.1 percent price increase.
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