The Dynamics of Industry Concentration for U.S. Micro and Macro Brewers

Victor Tremblay (), Natsuko Iwasaki and Carol Tremblay

Review of Industrial Organization, 2005, vol. 26, issue 3, 307-324

Abstract: In this update we document the changes in industry concentration of macro and micro brewers in the U.S. brewing industry since 1970. Technological change and the continued success of Anheuser–Busch forced the macro brewers into a war-of-attrition game and contributed to rising concentration in the macro sector of the industry. Homogenization of the beer produced by macro brewers, changes in local demand conditions, and a more favorable regulatory environment created profitable niches in many local markets for micro brewery beer, and entry into this sector occurred at a phenomenal rate from 1977 to 1998. Consistent with several models of industry dynamics, over-exuberance led to a shakeout as the number of micro breweries fell by over 16% from 1998 to 2002. Copyright Kluwer Academic Publishers 2005

Keywords: brewing industry; concentration; micro breweries; L11 and L66 (search for similar items in EconPapers)
Date: 2005
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DOI: 10.1007/s11151-004-8114-9

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