I think at least part of it stems from a modern lack of connection some people feel that elicits nostalgia for a (somewhat imagined) idyllic past when much more of what we consumed had to be produced locally — and what couldn’t be produced locally was at least sold by a small, local retailer so that everything you used had a face to it.
There’s an environmental aspect to it. All else equal, an item that travels a shorter distance will leave behind a smaller footprint.
And finally, an economic aspect: Not shopping locally will mean your town will stop producing some goods and focus more on others. However, if that focused on good rapidly falls out of fashion or starts being made w/automation, the town may feel a setback it may never recover from. Staying unfocused and diverse makes this less likely, and shopping locally helps that
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