Conclusion

This study was a first step in looking at an industry that probably deserves more attention than it is getting. The industry has exploded in the last few years and there is a sentiment that in some ways it is an indicator of some major shifts that will affect not just the beer industry, but all of manufacturing. Globalization has rendered America’s long standing strategy of producing low quality, cheap goods somewhat toothless, and perhaps, as David Sirota suggests in his piece “Can Beer Save America?” in Salon, American brewers will have to move into high quality, higher cost, highly differentiated product markets to survive (Sirota).

To this end, it seems important to discuss what factors are driving growth in these new, high-quality sectors. The marketing literature on craft beer suggests that the growth is due to craft beer becoming a new fad among young, hip, affluent individuals. For the macroeconomy, this has certain connotations. If this is a trend or a fad, then the market is at the mercy of the volatile consumption patterns of the youth. It suggests that the sector should not be taken much more seriously than the developers of the latest social media app. They may be getting some attention today, but in the long run they will not be remembered and their growth will be meaningless to the economy as a whole.

The findings of this paper seem to suggest that this may not be the case, because the marketing literature up to this point may be looking at the craft beer phenomena in the wrong way. Craft beer does seem to be responsive, to some extent, to certain regional factors, but they are not quite the factors that the marketing material would have predicted. Breweries seem to pop up where there is a good deal of wealth and demand for quality. Once wealth is controlled for, the race factor loses all statistical significance. It is not that craft beer is necessarily a market driven entirely by the consumption of white people as much as it is a costly, high quality good. The perception that it is a commodity aimed at white people stems from a failure to account for the unequal distributions of income across racial lines. The same can be said of age and liberalism. The regressions in this paper seem to suggest that it is not the youth of an area that drives growth in the sector, but the overall liberalism of the area. The implications of this observation are that growth in the craft beer sector may not be a fad subject to the whims of the trendy. Instead, they are consequence in a rise in demand for high quality products among the affluent, as well as products made by creative, enterprising entrepreneurs rather than colossal multinationals among more progressive individuals. These are not fads, they are trends that are likely to hold, and, possibly, to grow. They are indicators that perhaps academics, businessmen, and policymakers should be paying more attention to what is happening in the craft beer sector and applying its lessons to other sectors. Hopefully, to that end, this paper can serve as a starting point upon which more sophisticated research can be carried out. There is lot of work that needs to be done on this subject, but there is also potentially a lot that could be gained from those efforts.