Craft Beer in the US: History, Stats and Geography

Ken Elzinga (Virginia) and Carol and Victor Tremblay (Oregon State) have a paper in the latest Journal of Wine Economics titled “Craft Beer in the United States: History, Statistics and Geography.” The paper provides a great overview of the history of the craft brew industry as well as some interesting analysis on the geographic development of the industry. The history section seems to draw heavily on Tom Aticelli’s 2013 book The Audacity of Hops: The History of America’s Craft Beer Revolution, but provides a much more concise summary. And paired with the statistical overview of the beer industry in general and the empirical analysis of the craft brew industry that follows, this paper offers a nice, short primer for anyone interested in the history (and economics) of the craft brew industry in the US. The paper’s abstract follows:

We provide a mini-history of the craft beer segment of the U.S. brewing industry with particular emphasis on producer-entrepreneurs but also other pioneers involved in the promotion and marketing of craft beer who made contributions to brewing it. In contrast to the more commodity-like lager beer produced by the macrobrewers in the United States, the output of the craft segment more closely resembles the product differentiation and fragmentation in the wine industry. We develop a database that tracks the rise of craft brewing using various statistical measures of output, number of producers, concentration within the segment, and compares output with that of the macro and import segment of the industry. Integrating our database into Geographic Information Systems software enables us to map the spread of the craft beer segment from its taproot in San Francisco across the United States. Finally, we use regression analysis to explore variables influencing the entrants and craft beer production at the state level from 1980 to 2012. We use Tobit estimation for production and negative binomial estimation for the number of brewers. We also analyze whether strategic effects (e.g., locating near competing beer producers) explain the location choices of craft beer producers.

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