This week's Boston Globe Ideas section highlighted the burgeoning new field of beeronomics. Belgian economist Johan Swinnen is one of the leaders of the new field, and he is the editor of the new book, The Economics of Beer . The Ideas section interviewed Swinnen about the importance of beer to trade, industry regulation, and even the significance of microbeweries: SWINNEN: In terms of growth rate, it’s the fastest-growing segment of the beer market. It’s a bit paradoxical that it started in the US, as the type of beers they’re selling are more European-like or Belgian-like. In the US, there has been very strong consolidation of the traditional beer sector. Basically, you can see the microbrew movement as a counterrevolution against extreme consolidation, against the homogenization of beer. There were just a few breweries left, just producing lager beer. A lot of people who enjoyed more variety in beer couldn’t find anything. So people started their own breweries. It has been a tremendous success. IDEAS: For a while there, it seemed as though Americans simply loved light beer. Why did all this consolidation and homogenization happen if there was a market or a taste for other styles? SWINNEN: There is a fantastic chapter in the book by Lisa George, a professor. She argues that there are a number of different reasons. Really important was advertising. It became crucial after the breakthrough of TV. After the 1950s, you could have big companies advertising through the nation. There was the breakthrough of Budweiser and Miller Lite and whatever. Advertising spread the domination of a couple of big companies in the ’60s and ’70s. In Europe, this occurred 30 years later, because commercial TV only came to Europe in the ’90s. Before, it was state-organized broadcasting, and there was no advertising. Since the ’90s and 2000s, Europe has seen exactly the same phenomenon. IDEAS: So television killed local beer, or tried to. SWINNEN: There was also new science and technological innovation in the 18th century. Before, you had beer that was brewed locally, on a small scale. Most of the beer that was brewed was what we now call “specialty beer.” Then people discovered how yeast really worked. When you could control the yeast and the brewing process, you could brew really crystal-clear beer. And you could produce good bottles and ways of cooling better and putting tops on bottles, which made it possible to produce beer on an industrial scale. Read the full interview here .
Filed under: Small Business, Regulation, growth, beer, ideas, boston globe, microbrews, growth industries, beeronomics, economics of beer, johan swinnen