I don’t think it’s been disproven. I think Walmart disproved it...: )
I do know several stores that closed in small towns after Walmart moved in. Hardware stores, grocery stores, arts and crafts stores to name a few...
Walmart did not disprove it, basic economics disproves it. Because of Walmart and Aldi, I can purchase groceries and dry goods at a significantly cheaper price than a mom and pop. With the money saved, I purchase specialty items that I normally wouldn’t be able to afford from other mom and pop shops.
Example: Kroger carries this great line of wine, Pinnetti, for $4.99/bottle. It’s excellent. It’s our house wine. They also have a decent selection of other wines. However, when I make a special wine purchase I go to our local wine shop and and get personal service and do a taste test. I will spend more on the wine but I know that I will get what I want. That same bottle will be cheaper on the Kroger shelf, but the wine shop was able to provide the service that I needed. I do the same thing with paint. Lowes is cheaper, but if I’m spending money on paint I’m spending a little extra at our mom and pop for the service. Lowes is great for other things, and because I save money shopping there I can go to the mom and pop for more expensive paint.
This is what I learned back in 1962 from a High School Teacher.
Small towns have mom and pop stores everywhere. Two dime stores, two drug stores, two shoe stores ect. This is to show that there is no monopoly and no price fixing to keep prices high.
HOWEVER, the same stores have under the table handshake deals not to undercut each other in price so they can keep the prices high. The City Councils know this and keep competing business out of town and get their cut.
That is what the teacher said. A few years later some upstart company named WALMART opened outside the city limits and the people found they were being taken to the cleaners by the Mom and Pop stores.
Another thing that drove small town businesses out was...
3rd Salesman: Why it’s the Model T Ford made the trouble, made the people wanna go, wanna get, wanna get up and go
seven eight , nine, ten, twelve, fourteen, twent-two, twenty-three mile to the county seat
1st Salesman: Yes sir, yes sir
3rd Salesman: Who’s gonna patronize a little bitty two by four kinda store anymore?
When the State Highway Department improved the very dangerous roads (They cut off the very dangerous “DEAD MAN’S CURVE” years ago) to the bigger cities by 4 lanes people went to the bigger stores in larger towns.