Skip to main content

Has Anheuser-Busch Let the Steam Out of Craft Beer? The Economics of Acquiring Craft Brewers


Macrobrewers initially responded to the rapid growth of the craft beer segment by product differentiation: offering versions of their own “craft beer.” When this proved unsuccessful, they began acquiring independent craft brewers. We examine the consequences of Anheuser-Busch InBev’s acquisition of Goose Island. We find large gains in sales for craft brewers post-acquisition, which suggests that marketing spillovers attracted new consumers to craft beer. We also find large negative effects on product variety, which suggests greater difficulty for craft brewers gaining shelf space in off-premise accounts. These variety effects are particularly pronounced in Goose Island’s regional “birthplace”: Illinois.

This is a preview of subscription content, access via your institution.


  1. The terms “on-premise” and “off-premise” are industry parlance distinguishing whether the beer is consumed at the place of sale or taken elsewhere for consumption.

  2. In a survey that was conducted by Scarborough Research from August 2013 to August 2014, 48.2 percent of Chicago residents said that they drink beer. This was the nation’s second highest percentage, surpassed only by Boston’s 48.3 percent (Beer Marketer’s Insights Annual, 2015).

  3. “Annual production of 6 million barrels of beer or less (approximately 3 percent of U.S. annual sales). Beer production is attributed to a brewer according to rules of alternating proprietorships” (Brewers Association, n.d.). A barrel of beer is 31 US gallons and is a standard measurement within the US brewing industry.

  4. “Less than 25 percent of the craft brewery is owned or controlled (or equivalent economic interest) by a beverage alcohol industry member that is not itself a craft brewer” (Brewers Association, n.d.).

  5. “Has an Alcohol and Tobacco Tax and Trade Bureau Brewer’s Notice and makes beer” (Brewers Association, n.d.).

  6. Goose Island was a natural candidate for acquisition: ABI already had a minority stake in the company, and it was consistently the second or third largest craft brewer in the six-state area in and around Illinois each year from 2004–2009 leading up to the acquisition.

  7. As a “category captain,” a distributor may determine what brands are placed next to each other and the individual shelf level or cooler door where particular brands are displayed.

  8. The Nielsen dataset contains only off-premise sales, not on-premise sales.

  9. The acquisition was not pre-announced. Additionally, it was immediately implemented, because the financial magnitudes of the transaction were below the thresholds that were applicable at the time for reporting to the antitrust agencies under the Hart-Scott-Rodino Act of 1976. We address concerns about lagged effects post-acquisition in our robustness checks by dropping data around the time of the merger.

  10. Beer sales are not evenly spaced across the week. Because of this, as well as for simplicity during data aggregation, we count the entire week’s worth of sales in the month that sales are reported. For instance, if sales are reported on the third of the month, the entire week of sales are recorded as having occurred in that month.

  11. It is known that the major brewers engage in price discrimination as part of their competitive strategy; but we can find no literature that has studied this phenomenon and leave analysis of price discrimination in the beer industry to future research (Elzinga, 2016).

  12. Nielsen provides only the first three digits of the zip code for retailers, to protect their identity in the data.

  13. Federal Information Processing Standards (FIPS) codes are five-digit codes that uniquely identify counties or county-equivalent jurisdictions in the United States.

  14. Out of almost 3.8 million observations, we drop less than 14,000 due to this restriction. It should be noted that no macrobrewers were excluded due to this restriction.

  15. We include all beers that were sold by ABI, Constellation, MillerCoors, Heineken, and Pabst.

  16. The NBWA claims ABI “encourages distributors to drop rival beers and replace it [sic] with an ABI owned ‘craft’ to replace any lost sales....The pressure to drop rival beers does not end there. ABI executives have frequently visited distributors that choose to sell non-ABI products to encourage them otherwise, and publicly criticize distributors that carry non-ABI brands at trade meetings.” (National Beer Wholesalers Association, 2016).

  17. The post-merger time period begins in April 2011, and the pre-merger time period ends in March 2011.

  18. Note that this is at the individual store level – not the retailer chain level.

  19. In the Nielsen dataset, because retailers’ names are masked, our results do not imply anything with respect to these specific stores.

  20. Because this is the same company, we are unable to add Year x Company interactions to this analysis.

  21. The 25th percentile is at .2145 ABI Market Share, the 50th Percentile is at .3604 ABI Market Share, and the 75th percentile is at .5731 ABI Market Share.


  • Beer Marketer’s Insights Annual. (2015). Beer Industry Update. New York.

  • Beer Marketer’s Insights Annual. (2020). Beer Industry Update. New York.

  • Brewers Association, Craft Brewer Definition. (n.d.). Retrieved September 1, 2021, from

  • Burgdorf, J. (2019). Impact of mandated exclusive territories in the US brewing industry: evidence from scanner level data. International Journal of Industrial Organization, 63, 376–416.

    Article  Google Scholar 

  • Elzinga, K. (2016). The beer industry. In J. Brock (Ed.), The structure of American industry (13th ed., pp. 119–140). Waveland Press.

    Google Scholar 

  • Elzinga, K., Tremblay, C., & Tremblay, V. (2015). Craft beer in the United States: history, numbers, and geography. Journal of Wine Economics, 10, 242–274.

    Article  Google Scholar 

  • Frake, J. (2017). Selling out: the inauthenticity discount in the craft beer industry. Management Science, 63(11), 3930–3943.

    Article  Google Scholar 

  • Maltby, N. (2020). Corporate Governance, the Craft Brew Alliance, and A-B. In E. S. Madsen, J. Gammelgaard, & B. Hobdari (Eds.), New developments in the brewing industry the role of institutions and ownership. Oxford University Press.

    Google Scholar 

  • Miller, N., & Weinberg, M. (2017). Understanding the price effects of the MillerCoors joint venture. Econometrica, 85(6), 1763–1791.

    Article  Google Scholar 

  • National Beer Wholesalers Association. (2016). Re: Comments from the National Beer Wholesalers Association Concerning the Proposed Final Judgment in United States v. Anheuser-Busch InBev SA/NV and SABMiller plc.

  • Noel, J. (2018). Barrel-aged stout and selling out: goose Island, Anheuser-Busch, and how craft beer became big business. Chicago Review Press.

    Google Scholar 

  • Schumacher, H. (2014). List: Top 30 US beer distributors. Retrieved October 20, 2020, from

  • Takahashi, P. (2019). Silver Eagle’s Houston beer business to be acquired in $1B deal. The Houston Chronicle. Retrieved October 12, 2020, from

Download references


The authors thank Luke W. Haynes and L. Jackson Howell Jr. for research assistance and Orley Ashenfelter, Federico Ciliberto, Charles Courtemanche, Anthony Creane, Carlos Lamarche, Alexander MacKay, Frank Scott, and attendees of the International Industrial Organization Conference in Boston and the American Association of Wine Economists Conference in Vienna for comments and helpful suggestions.

Author information

Authors and Affiliations


Corresponding author

Correspondence to Kenneth G. Elzinga.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Elzinga, K.G., McGlothlin, A.J. Has Anheuser-Busch Let the Steam Out of Craft Beer? The Economics of Acquiring Craft Brewers. Rev Ind Organ 60, 147–173 (2022).

Download citation

  • Accepted:

  • Published:

  • Issue Date:

  • DOI:


  • L11
  • L42
  • L66