Is Walmart Safe?

Topics: Regression analysis, Errors and residuals in statistics, Statistics Pages: 7 (1983 words) Published: October 31, 2012
Is Walmart Safe?
The Effects of Established Supercenter Walmarts to Property Crime Rates within Dekalb and Gwinnett County from 1999-2010

Class: Economics & Finance Modeling
Professor: Doctor Derek Tittle

Dream Team Group Members:
Alexandra E Steingaszner
Brian-Paul Gude
Kristopher Bryant
Norman Gyamfi
Samantha Gowdy

This report has been created in the framework of a student group project and the Georgia Institute of Technology does not officially sanction its content.

Executive Summary
Every year, Walmart is accused of increasing crime in areas within which it builds Walmart Supercenters. Yet, research and data analyses largely disprove these claims, as they reveal that other factors such as unemployment rates and population appear to contribute more to an increase in crime rates rather than the construction of Walmart stores. The software Minitab is used to analyze linear regression with the inputs population, demographics, high school graduation rates, unemployment rates, median household income, and the number of Walmart Supercenters and the output property crime rate. The overall purpose of the analysis was to reveal the relationship(s), but not causation, between these inputs and property crime rates. Ultimately, this analysis reveals no definite relationship between the number of Walmart Supercenters and property crime in the years 1999 to 2010 in Dekalb and Gwinnett County. Background

One of the most significant issues concerning Walmart in communities is the existence of a relationship between the presence of a Walmart and local crime rates. In past years, these concerns have been voiced by local residents and public law enforcement. Justice Starcher, a member of the West Virginia Supreme Court, states that “a quick review of reported cases reveals that Walmart parking lots are a virtual magnet for crime” and Chief John Slauch of the West Sadsbury Township Police Department “saw a significant increase in crime and incident calls for service from the date Walmart opened.” These accusations have resulted in the common belief that Walmart stores directly and indirectly increase crime. A research and analysis plan was developed to determine whether or not any relationship exists between Walmart Supercenters and property crime rates. In order to compare various non-violent crime rates, the initial plan was to run 3 different analyses with 3 different outputs: property crime rates, larceny from a vehicle, and larceny from a non-vehicle. These crime categories were chosen after counseling a student employee of the Georgia Tech Police Department, Harvaran Ghai, who works on data crime analysis. These crime rates were suggested because they were the top 3 non-violent crimes on campus. However, as time progressed and the full amount of work entailed in this project was realized, time only allowed for analysis on property crime rate: a category of crime that includes, among other crimes: burglary, larceny, theft, motor vehicle theft, arson, shoplifting and vandalism. After the problem was defined, input data was collected. Using the sources listed in “Appendix 1: Works Cited” we were able to obtain 7 inputs: population, demographics (the African American and Caucasian race as separate inputs), high school graduation rates, unemployment rates, median household income, and number of Walmart Supercenters in the given counties at that particular moment. In order to get enough observation points to run regression, monthly data was collected and used over the course of 10 years (1999-2010). Monthly unemployment rates were easily obtainable; however, all other inputs had yearly data, and this data was manipulated in order to create monthly data points. Analysis

The following observations were made per iteration of data analysis in order to compare iterations to each other to see improvement to these observations: R2, p -values of individual variable, 4 residual plots. Unusual observations...
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