It's definitely complicated. I was thinking of a few different scenarios and in some cases it's not clear that local distribution is always a better route. For example if your local store gets a shipment of 100 items and only sells 10 what happens to the other 90? Do they get shipped back? Thrown away? Who knows... If the UPS truck happens to be down the street and needs to go 1 mile out of its way to make a delivery to me that's better than my own 10 mile trip. Even with your example of less physical stores we'd have to consider that means less jobs, less revenue for the town in the form of property taxes when the business closes, less sales tax for the state -- apparently Amazon only charges sales tax in 5 states.