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The IUP Journal of Knowledge Management :
Quantitative Analysis of Compensatory Model: The Impact of Shopping Malls on the City Structure
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This study showcases the multi-attribute decision support methodology applied to analyze the impact of shopping malls on the city structure. The influence of shopping malls on the city is described as the sum of the effects of the quality of life, the neighborhood, the work of city transportation system and architectural and urban perception of the city. The influence of shopping mall is measured in the form of different attributes rated on a scale, and then rating summation is carried out using Compensatory Model to evaluate each attribute with respect to belief and actual impact. The main attributes are distinguished to measure the influence of shopping malls on the city structure. The weights of attributes are estimated from the data collected through an online survey. The initial rating for the attributes is done through surveys carried out among experts in the twin cities of Bloomington-Normal. Compensatory models/ multi-attribute model is used to evaluate high preference attitude towards ranking the attributes as per the weights estimated through the model. A quantitative analysis, using multiple regression analysis, is carried out to check the viability of the results calculated through compensatory model. A multivariate correlation analysis is carried out to showcase the interrelation of the attributes and how the change in one attribute showcases a change or stability in another attribute. Overall, the effect of shopping mall on the city structure are analyzed based on the factor of belief and final outcome.

 
 
 

In the past three decades, the US retail industry has grown by more than 60%. Considering the factors like increase in population, pay rise, and increase in standard of living, it is of no surprise that the evolution of the industry was with the course of time. Low-cost products, discounted high sales volume, and high inventory clearance were some of the many factors which turned out to be profitable for the rise of the industry. Low-cost items and availability of their easy replacement made it possible for this industry to grow with high volume of sales compared to any other industry (Assael, 1987). Currently, leading its way in the retail industry, Wal-Mart has had a tremendous success on the scale of profitability. With time, other emerging companies like Meijer’s and K-Mart started competing for the market share in the retail industry. There was a steady rise in the profit of these competitors, but Wal-Mart remained the leading brand with maximum market share.

This study deals with the twin cities of Bloomington-Normal (henceforth referred to as ‘city’) located in the Mclean county in the central Illinois region. Normal is a small town with a population of 70,000. The major employer of the city is State Farm Insurance; the city is densely populated with middle-class and lower upper class income segments. The shopping malls have played a major role in the growth of the city. The first shopping mall was started in the year 1982, and by 2011, it had 8 shopping malls. The main reason for the increase in the number of the shopping malls was the increase in the population of the city which was the result of the change in the environment of the city which took place due to the growth of certain factors. These factors act as attributes towards the rise in the number of shopping malls in the city. Also, with globalization, new investors started investing in the growth of the retail industry. As a result, many issues evolved addressing the factors of environmental changes, changes in architectural and urban perception, changes in communication and transportation and changes in the economic aspect of necessity of a city. A city with limited population but with multiple shopping malls posed a question to the town planners to think about.

 
 
 

Knowledge Management Journal, Quantitative Analysis, Compensatory Model, Shopping Malls, Bloomington-Normal. Compensatory, Attribute Description, Change in Environment, Architectural, Urban Perception, Communication, Transportation.