It’s a really good question. The instant, obvious answer is local business… but the more I think about it, the more I am wondering if the chain store is better for the neighborhood?
I mean, when the chain store opens, they bring outside investment into the neighborhood. How much of that is captured by local businesses, and by local trades people and such? Is the land owner local? Do they buy the land or lease it from a local business? How many local people work on the building?
We can assume the workers are all local. While they may bring in a “training crew”, it’s likely that the employees will be from the neighborhood, or will join the neighborhood. This is probably a wash (although local owned businesses tend to concentrate that income into a smaller number of families / households)
All the profit generated by a locally owned business stays in the local community. But there isn’t much profit at all in groceries - WalMart takes out about 1% in profit. I don’t know what the profit percentage on a locally owned corner store is, but I don’t see many people making it really, really rich on a local corner store.
My intuitive guess is that most of the higher prices at the local corner grocer is going to their suppliers as increased profit to them. If this was true, the lower prices at the chain store may benefit the local neighborhood more than the profit retention.
I would love to see a definitive answer… my only guess is that it’s not as clear cut as “local good, chain bad”… or “chain good, local bad”. 
