Beer and Competition

  1. Quick problem: if entry is sequential — you’re one of three successful bidders for setting up an ice cream stand on a beach and you have to put in wiring — where do you put your stand if you set up first? second? of course, knowing that, you know where you set up third?
  2. I posed a query: beer consumption exploded from the late 1950s until about 1980. What should have happened to the number of beer producers during this interval? Now Chapter 2 is on demand and supply elasticities, the basic environment; concentration is the topic for Chapter 3 of Tremblay & Tremblay and (tentatively) a week from Friday on the syllabus in parallel to material in Martin. But think about the issue.
  3. A beer story from today’s Bloomberg on the plans of Sapporo Brewing [<== link] to increase revenues. Now Sapporo is  a Japanese firm and the domestic market resembles that of the US. So what options do they have?
  4. I’ll intersperse stories of other industries as the term progresses. Start looking for a topic for your term paper. I’ve had ones ranging from (i) law firm mergers and (ii) competition between gaming systems to (iii) individual firms and (iv) standard consumer products. Policy topics are possible, but not hard; we won’t cover much in class, and what we do cover (various technology topics) won’t be until later in the term.
  5. Late addition: I searched for recent articles = “beer 2012” on Bloomberg, and found the following:
    1. America’s Biggest Beer Drinkers By Venessa Wong on June 27, 2011;
    2. After NYC beer museum tour, hop on over to its bar By Meghan Barr on May 25, 2012
    3. Flat Times for Beer Stocks By on February 09, 2010
    4. Ale to the chief: White House releases beer recipe By Matthew Daly on September 01, 2012

5 thoughts on “Beer and Competition

  1. “America’s Biggest Beer Drinkers”
    This article puts into perspective the staggering beer consumption per capita rate in the United States: 221 cans per legal head. [The Prof: But look at the table in T&T comparing national averages, we’re half Czech levels!!]

    • Yes, but look at the table in chapter 1 of T&T on comparative consumption. US levels are down from that time, though not by much. But Czechs consumed (i) 2x as much beer, (ii) 2x as much wine, and (iii) 2x as much hard liquor. They have a well-lubricated society…

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