The former Gunners forward would swap the winger for Liverpool's star youngster if given the chance.
England international Sterling is currently being linked with a number of clubs across Europe after turning down a new £100,000-a-week contract at the Anfield club – per the BBC - despite months of negotiations.
Walcott is in a similar position, with just a year remaining on his deal at the Emirates and yet to open negotiations over fresh terms, although Sky Sports claim those will begin soon.
Now, Hartson has said he would exchange the players if given the opportunity to do so.
“I think Sterling is a bigger impact player, who makes things happen more on the pitch than Walcott does,” he said.
“He excites you when he gets on the ball, a lot of the time on the ball he makes things happen, he's had to take a leading role for Liverpool this season and played in so many different positions.”
The former forward has also praised Sterling, saying the youngster is one of best young players around, especially as far as England are concerned.
The forward has enjoyed a rather rapid rise to the top after breaking into the Liverpool first team under manager Brendan Rodgers, ultimately becoming one of their key players and a regular starter for the Three Lions.
As far as Hartson is concerned, that would interest Arsenal manager Arsene Wenger, who is well known in the game as someone who can develop young talent and turn them superstars - Cesc Fabregas being a notable example.
“He's arguably one of the best young players, one of England's best,” he added.
“Wenger likes to get young players and nurture them. But I like Walcott and I think he will sign a new contract”