Date of Submission
Open Access Senior Thesis
Bachelor of Arts
2020 Connor W Sinclair
As growth of the American craft brewing industry slows and smaller firms account for a greater proportion of expansion, I test whether traits that are indicative of smaller firms have an effect on brewery success. I hypothesize that firms which utilize localist strategies such as geographical branding, use of local ingredients, charitable giving, and/or sustainable practices are more successful than others and therefore produced more barrels of beer in 2017. To test my hypothesis, I estimate ordinary least squares regressions with robust standard errors using data collected from the Brewers Association and the websites of 362 California craft breweries. I find no evidence that geographic branding is correlated with brewery production volume. I find that using local ingredients is negatively correlated with lower production volumes. Sustainability, charitable practices, environmentalism and involvement with the fine arts are found to be insignificant determinants of production volume. I find that breweries with an award-winning beer produce significantly more beer than those who have not won an award, and that older breweries produce significantly higher volumes of beer. Substituting production growth rate as the dependent variable, I find that younger breweries grew significantly more than older breweries between 2016 and 2017.
Sinclair, Connor, "An Econometric Evaluation of Localism and Other Potential Success Factors in California’s Craft Brewing Industry" (2020). CMC Senior Theses. 2506.