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From Monasteries to Multinationals and Back: How Beer Explains the World by Johan Swinnen and Devin Briski

Author Name: JOHAN SWINNEN

Email: JO.SWINNEN@KULEUVEN.BE

Synopsis:

The history of beer is the history of civilization. Changes in beer consumption and brewing did not only follow from scientific and economic changes but also played a major role in social, political, economic and scientific innovations and change. This book tells that story – from an economic, political, and historical perspective.

The sample outlines the main themes of the book and presents a proposed outline of five parts (including 22 chapters in total), and explains why the book is unique in its approach and its focus.


Length of Sample (in words): 6500

Writing Sample/Excerpt:

Title:
From Monasteries to Multinationals and Back:
How Beer Explains the World.

Authors:
Johan Swinnen and Devin Briski

This book is about war, empires, religion, innovation (and the lack of it), the industrial revolution, corporate power and monopolies, globalization, science, multinational control of domestic markets, technology, anti-globalization movements and the search for local products and quality. And all this through a "beer lens".

The book explains why monastries came to be the global centres of brewing after the fall of the Roman empire, why medieval traders needed hops, why the British Navy needed beer to create its empire, why beer created borders and defeated the Spanish empire, how television caused the decline of local breweries, how beer aided the post-Communist transition in Eastern Europe, how the global beer markets are rapidly changing, and how Belgium's "peasant beers" came to be known as the best in the world.    

All stories/chapters are based on sound academic research, but written in an easily accessible way.

A brief historical review

The history of beer is the history of civilization. Beer is the most consumed alcoholic beverage today, and brewing started many thousands of years ago in various places on the globe, including Asia, Africa and Europe. Archaeological findings suggest that beer is the more likely candidate than bread as the primary reason why early societies transitioned from hunter-gatherer to agrarian style of living. Before the discovery of bacteria and how to kill it, beer was essential nourishment for people around the world. They didn’t know why water made them sick—they just knew that beer didn’t.
After the fall of the Roman Empire until almost a millennium later, European monasteries where the main centres of brewing, and the only places were beer was manufactured on anything like a commercial scale.
From the 13th century onwards, monasteries lost out to commercial companies as the main brewers. Economic growth and the rise of trade cities played a role, but innovation and public finance played a role as well. Breweries became major sources of tax revenues for rulers. Religious and political changes added to the transformation. During the Reformation, many Catholic monasteries were destroyed. The final straw was the French Revolution which clamped down on the Catholic church. French expansion, under Napoleon, destroyed the remaining monasteries in Europe – and with it their breweries.
Yet today, monastery brews are hot again. From San Francisco to Beijing, abbey ales from certified Trappist breweries shipped over from Belgium can sell for $18 at fancy restaurants, paired with dishes as part of the new art of “beer gastronomy”. An aura of authenticity surrounds the traditional monastic recipes, the sense that one is drinking centuries of tradition. These abbey ales have become the face of a global craft countermovement—a reaction to the industrialized and globally integrated market for mass-produced lager beer.
Scientific discoveries in the eighteenth and nineteenth centuries caused a dramatic transformation of the beer industry. Knowledge about yeast, steam engines and refrigeration, made it possible to produce new types of beer and to better control the production process. The brewery industries embarked on the road to industrialization, consolidation and globalization. Today, one multinational company sells a quarter of all beer consumed in the world.
Globalization also brought major changes in global beer consumption patterns. Beer consumption has been declining in many traditional markets, inducing local brewers to search for growth markets outside the borders. They found growth in the emerging markets such as Russia, India, and China. There are traces of brewing going back thousands of years in China, but beer had largely disappeared. Twenty five years ago, less than one percentage of the population had ever tried beer. However, the dramatic economic changes in China have also triggered a rapidly growing thirst for beer. Over the past decade, none other than China has claimed the title for world’s largest beer market.
Yet, after two centuries of consolidation and closing down of smaller commercial breweries, a counterrevolution is under way. In traditional beer-drinking nations such as Britain, Belgium, and the Czech Republic—not to mention America, where the most consolidated industrial brewing industry gave way to the fastest growing and largest craft beer sector starting in the early 1990s—a growing segment of consumers are rejecting the industrial, mass-produced styles of beer that scientific advancements during the industrial revolution had afforded. Instead, they are demanding a return to local, batch brews, traditional recipes and techniques.
This craft counterrevolution has accompanied a renewed interest in beer more generally—its history, its role in the development of civilization.
This book tells that story – from an economic, political, and historical perspective. Because changes in beer consumption and brewing did not only follow from scientific and economic changes but also played a major role in social, political, economic and scientific innovations and change.
Throughout history, beer was a major source of tax revenue for governments and beer taxes were used to finance wars and empires. The tax revenue factor delayed major innovations in brewing in the middle ages and it later constrained the influence of temperance movements. Brewing was influenced by scientific breakthroughs in the18th and 19th centuries, but research on beer itself contributed to major scientific contributions, not just in biology and chemistry, but also in areas such as statistics. The rapid consolidation of breweries and their relationships with pubs inspired many anti-monopoly cases in the US and elsewhere, and is a controversial topic until today. Concentration, domestic and globally, have led to a few multinationals dominating the beer markets of the world, causing concerns about consumer protection worldwide. With global market integration, protectionist instruments, such as Germany’s Reinheitsgebot, have been removed. It also caused conflicts in international trademark law—such as the fight over rights to "Budweiser" between the largest American brewer and the Czech state-owned Budweiser Budvar brand. And the recent demand for craft beer (and the return of the monasteries) was aligned with the anti-globalization movement and demand for more quality and local products over the past decades.

This book addresses all these issues, and more, and is organized in five parts:
PART ONE: WE BUILT THIS CIVILIZATION OUT OF HOPS ‘N’ MALT
PART TWO: A REVOLUTION IS BREWING
PART THREE: BREWING AFTER THE FALL OF THE WALL
PART FOUR: FROM LAND TO BRAND
PART FIVE: A COUNTERREVOLUTION IS BREWING

The book is unique because of its approach and its focus.

The book is jointly written by an (academic and policy) economist/political scientist (who is the President of Beeronomics: The Global Society for the Study of the Economics of Beer and Brewing) and a journalist. The book will follow the Freakonomics model: economist and journalist team up to relay academic scholarship to laymen. Freakonomics sold four million copies worldwide the first four years after its 2005 release, spawning a franchise that includes blog, radio show, and recently published sequel SuperFreakonomics. Other books in this genre include Soccernomics, which has sold 80,000 copies in the US since its release.

We envision From Monasteries to Multinationals and Back as the type of book you can pick up in San Francisco international airport, and by the time you’re descending into Munich International Airport, you’re not only versed in the historical significance of the Reinheitsgebot, but ready to explain to business associates why Germany led the world in the scientific revolution in brewing, yet so completely missed the memo on global integration.
Currently, there are no books following the model of popular read version of scholarship for beer focusing on economic, political and social aspects. There are also few popular read volumes that focus on the historic context in which beer brewing practices evolved. Instead, most of the current bestselling books on beer address home-brewing techniques and beer tasting, including The Art of Fermentation by Sandor Ellix Katz with a forward by Michael Pollan and Tasting Beer: An Insider’s Guide to the World’s Greatest Drink by Randy Mosher, and The Oxford Companion to Beer by Garrett Oliver with a forward by Tom Colicchio. All of these volumes are directed toward an audience of laymen, but largely ignore the political and economic context. The Oxford Companion to Beer includes some of this information, it is organized as a glossary instead of a story.
Volumes on the history of beer also exist, but most are extremely dense and few focus on the economics and politics behind historic threads at work. A World Atlas of Beer: Essential Guide to the Beers of the World and A History of the World in Six Glasses reflect current popular volumes on beer history that organize the narrative more around beer styles and brewing traditions.

PROPOSED OUTLINE

PART ONE
WE BUILT THIS CIVILIZATION OUT OF HOPS ‘N’ MALT

At some point around 700 AD, one medieval spice thought to promote fertility, associated with mystical powers was added to beer. Five centuries later, hops would revolutionize the global brewing industry. But not just yet. A curious thing is why the most ubiquitous ingredient in beer took so long to become a widespread practice—and when it did, it did so completely. So why didn’t monasteries employ hops’ preservational powers in their own brewing? Beginning around the thirteenth century, the use of hops would upset not just the brewing industry but coincide with centuries of political upheaval and change. It was at this point beer became a commodity: something to turn a profit.
The Dutch Revolt against the Spanish empire, the historic prominence of Amsterdam as centre for trade and commerce, the power of the British Royal Navy, the success of the Counterreformation in southern Germany: what do they all have in common? They can all thank beer for their position in the annals of European history. Or, more accurately, beer taxes. As an addictive commodity, alcohol has shaped the trajectory of Western civilization more than most political philosophers might like to admit. And in fact, an archival glance back reveals that beer taxes underwrote events that shape our modern world: the Dutch Revolt, the Counterreformation, British imperialism, and more.
Part One of the book explores how the intersection of political power, strategic tax policy, and innovations in brewing influenced outcomes of significant events in European history. These events were intertwined with two major changes in the history of brewing: the introduction of hops and the growth of commercial brewing and the decline of the monasteries.

Chapter 1: A Revolution Every Thousand Years (Part 1):
How Hops Jumpstarted Commercial Brewing in Medieval Europe
Beer can be made from barley or wheat, but the one ubiquitous ingredient is actually an additive: hops. How did the addition of one herb become such a widespread practice in brewing? Well, it didn’t. It all began when brewers in trade cities Hamburg and Bremen found a way to monetize hops' unique function as a preservant. But when imported barrels hopped beer arrived in England and the Low Countries, the new style undermined a major source for local tax revenue: gruit, the additive blend that municipal governments taxed and distributed to local breweries. For hundreds of years this side-effect of the use of hops led to its prohibition in some of the major beer producing countries. It was only when commercial brewing developed, and with it a shift to a new tax model, that hops were allowed to … [something like that] This chapter will give a localized account of political economies of medieval brewing. The basic thread will be the transition from gruit to hops and how hops enabled commercial (rather than monastic) brewing and the beer trade.

Chapter 2: The Protestant Ethic and the Spirits of Capitalism:
How Beer Funded the Dutch Revolt (and Created Belgium)
Phillip II never saw it coming. The 16th century Spanish Habsburg King not only presided over a worldwide empire, consolidating imperial control in the New World while maintaining the Habsburg sphere of influence in northern Europe. He had silver by the shiploads at his disposal. Following Martin Luther’s 95 Theses, a new theology spread like wildfire and gave former Hanse cities the confidence to fight against their Austrian overlords. Some may argue that the biggest mistake he made was underestimating just how discontented northern Europe’s merchant class was with the Catholic Church, just how inspiring the Protestant word was, just how difficult military conquest of grassroots revolutions can be. But there is another major reason: beer taxes.
This chapter will present the argument that effectively administered beer taxes in Holland served as a source of tax revenue for the Dutch Revolt while gold from the New World failed to provide Phillip II with adequate revenue to beat the rebels. The border between Belgium and the Netherlands was effectively decided on the basis of beer tax revenue.

Chapter 3: How Weissbier Funded the Counterreformation
Devoutly Catholic Bavarian King Maximilian I needed to find a way to atone for his father’s debts. Munich was center of Catholic Counterreformation, collapsing upon itself thanks to constant barrage of attacks from Protestant forces. If nothing else, Northern Germans had an edge on the Catholics when it came to money. But Bavarians drank more beer. Maximilian I brilliantly concocted a scheme to monetize existing German beer law, the Reinheitsgebot, into social policy by leveraging a royal power to instill the right to brew weissbier—the top-fermenting wheat beer that stood as exception to state-wide ban on summer brewing.
This chapter will describe how the Bavarian crown used its monopoly on weissbier production both to pay back debts associated with hosting the counterreformation and as a form of Catholic social policy.

Chapter 4: The Brew That Launched A Thousand Ships:
How Porter Paid for the British Royal Navy (and the Empire)
After a century and a half of non-stop warring, the Great Britain of the 19th century was truly remarkable: imperialist superpower abroad, industrial powerhouse at home. But how did such a small island nation with so few natural resources manage to win so many wars against its continental rival France? And how did it do so without taxing its population into submission and inhibiting commercial development? A look at the data reveals that Parliament’s (morally questionable) genius was to pass the tax burden onto the new urban proletariat by levying high excise taxes on period cheap beer: porter.
This chapter will tie together disparate historic threads of research on British tax bureaucracy, the industrial revolution in brewing, and Britain's rise to military power.

Chapter 5: Why Temperance Activists Always Make For Unlikely Bedfellows
“Ireland sober, Ireland free!” The rallying cry of the world’s only Catholic-led temperance movement hitched on the back of widespread discontent with English imperialist rule, to which James Joyce’s dark rebuttal, “Ireland sober is Ireland stiff.” A similar campaign in India was arguably more successful: Gandhi’s peaceful protestation of British imperialist rule called for widespread abstinence from alcohol, in both nations, a major source of tax revenue for the British crown. Frequently led by women, temperance movements swept a newly industrializing world during the late nineteenth and early twentieth century, the response to perceived unruliness of new urban proletariats and immigrant groups in industrializing cities. Their goals were fairly uniform: limit or end the consumption of alcohol. American temperance activists had a very different message from their compatriots across the pond: a vehemently Protestant movement with nativist undertones—nasty stereotypes of Irish and Eastern European immigrants were called upon to drum up support—fueled a political movement eventually ending in a decade long Prohibition on alcohol consumption. The real key to American success was an alliance with the Progressive party petitioning for an income tax. In Canada, alcohol regulation policies were tacked onto the nation’s declaration of its entrance into World War I. In Russia, temperance activists and Communists teamed up to bring about the Bolshevik revolution. What do these all have in common? If they wanted Prohibition, first they needed to figure out how the government would replace lost tax revenue from no beer taxes.
This chapter will analyze temperance movements in America, Ireland, India, Canada and Russia to show how in each case, temperance activists teamed up with a political movement petitioning some change in government. In each case, this had to do with the revenue that the existing political party generated from taxes on alcohol.

PART TWO:
A REVOLUTION IS BREWING

It’s difficult to place a value judgment on the victories of the British Royal Navy, but most everyone can agree on the bleakness of a world without ice cream. In fact, early refrigeration technology joins Pasteurization and inferential statistics on the list of nineteenth century scientific developments underwritten by the brewing industry. The reason behind beer’s role in scientific revolution is consistent in all these cases: as urbanization brought large populations of rural migrants together in condensed cities, the possibility of brewing on a large scale presented lucrative opportunities to profit—for whoever could figure out the technology necessary for success.

There would inevitably be a feedback cycle at work. While brewers contributed to the emerging canon of applied scientific research, these new technologies in turn revolutionized the brewing industry. In traditional beer-drinking nations, a long-thriving sector of rural brewer-publicans found themselves undercut by industrial breweries with an affordable and consistent product. Some factors are obvious and consistent across products: the assembly line, newly constructed railroads to cut down on distribution costs, but some are far more surprising. For example, who would guess that the dramatic consolidation of the American brewing industry can in large part be attributed to a drinking culture centered around its favorite past time… watching TV.
This section explores the industrial revolution in brewing from two perspectives: both how brewers contributed to the scientific revolution and how the industrial revolution upended previously local and disparate nature of beer markets in traditional beer-drinking cultures.

Chapter 6: A Revolution Every Thousand Years, Part 2:
How Bottom Fermentation Brought Industrial Beer to the Masses
In the Czech Republic, almost every brewery is located near a pond. This may seem surprising as water for brewing did not come from ponds but from rivers. The purpose was different. Before refrigeration technology, brewers would cut ice from the pond every winter and shovel it into underground cellars for the refrigeration, or lagering process. The bottom-fermentation method allowed brewers to easily scrape out the yeast and made for a more consistent, reliable style of beer. It had originally been co-opted by Bavarian brewers who took up the practice of storing beer in caves in the Alps during summertime. Following the Industrial revolution, it was brewers in Munich, Plzen and Ceske Budejovice that recognized the potential for profit this style of beer offered in newly urbanizing cities. If only there was a technology that could keep beer cool without relying on extracting ice blocks in January…
This chapter gives an overview of brewing and the industrial/scientific revolution, discussing scientific discoveries that happened in and around beer, and why the lager style was so conducive to profitable large-scale brewing.

Chapter 8: Economies of Ale:
The Twentieth Century as Age of Consolidation
The industrial revolution not only changed the nature of the beer market (from top to bottom fermentation) but also the structure of the brewery sector. Prior to the industrial revolution, most beer-drinking nations had been spotted with small, local breweries. These shuttered en masse throughout the twentieth century while a few, large-scale industrial operations cornered domestic markets. Belgium entered the twentieth century with more than four thousand breweries. By 1980, there were around 100. By 1990, three American breweries produced more than 95% of domestic beer. But why beer? There is an economic concept called “economies of scale” which holds if a commodity requires high capital investment upfront (as does the technology to build a brewery), then its efficient production tends towards large facilities, mass production, market concentration. Lo and behold, the styles of beer that came from the industrial revolution era—lager and stout—are those that lend themselves well to this type of large-scale production.
This chapter will explore the market forces that enabled such a prolongued and dramatic consolidation of the brewing industry, in addition to pointing out why some nations ended up with higher market concentration than others ).

Chapter 9: How Video Killed the Regional Brewery
Chapter 8 explains how the new ways of producing beer had a major effect on the structure of the brewery sector. However, change not only came from within the sector but also from outside. An unlikely culprit was the growth of commercial radio and TV and the spread of national advertising. The spread of commercial broadcast television with its advertising strategies was a major factor in the decline of small local breweries. In America this force of brewery consolidation started in the 1950s as commercial TV swept the country. In Europe where TV stations were publicly owned, this process did not start until the end of the 20th century as commercial TV took off. In countries like Russia, the transformation of the economic system in the past 20 years also induced a major growth in commercial advertising, transforming the beer market.
This chapter will narrate the correlation between television advertising and consolidation of the brewing industry.

Chapter 10: Justice Wears Beer Goggles:
Beer and Competition Policy
There’s a big debate on the game of Monopoly™: is its political purpose to demonstrate all free markets end in corruption and price gouging, or just the opposite? It depends on how well you play… But it was created during a point in American history when wealthy robber barons had taken advantage of their respective monopolies on resources—John D. Rockefeller with oil, Leland Stanford with railroads—to make themselves very rich and bankrupt the rest. Its also when competition policy was born. The purpose of antitrust policy is “never again”—curb the worst tendencies of capitalism and keep things fair. Competition concerns have focused not only with so-called “horizontal” concentration (through growth and mergers) but also with “vertical” coordination. But it can be tricky to decipher when one company with so much market power helps keep prices low, and when it is artificially inflating them. In the US and the UK, competition policy was contested and refined by way of questions about the brewing industry…
Under the deregulation fervor of Margaret Thatcher in the 1980s in the UK, scrutiny was not focused on horizontal coordination but vertical — Great Britain's historic tied house system came under fire thanks to competitive concerns. The 1989 Beer Orders forced a mass divestiture of pubs in hopes of increasing competition and lowering prices for consumers… but did it work?
Not only did competition rules affect the brewery industry, a historic glance back showed that the brewing industry played a major role in shaping US competition policy. Two cases greatly expanding the powers of the DOJ in anti-merger enforcement were decided around the American brewing industry: DOJ v. Pabst and DOJ v. Falstaff.
This chapter will discuss how the brewing industry sheds light on vertical coordination (mergers) and horizontal coordination (the tied house system).

Chapter 7: Guinnessometrics:
What Inferential Statistics Can Learn From Stout
Steve Ziliak is a renegade statistician with a big question for his field: what’s the significance of “statistical significance”? He’s been touting this point for years, but it wasn’t until he began research on a book-length critique that he learned he wasn’t the only one to take issue with the dominant academic approach. The calculation of standard error was developed one anonymous scholar writing under the name “student” with an approach similar to Ziliak’s. By day, student was William Gosset, head experimental brewmaster for Guinness during the early twentieth century.
This chapter will draw upon old Guinness archives to show how Gosset’s alternate approach to inferential statistics was pivotal in Guinness’ success.

PART THREE
BREWING AFTER THE FALL OF THE WALL

When Ronald Reagan requested Gorbachev “Tear down this wall,” he meant both literally and figuratively—economic reforms in former Eastern Bloc opened up a long-sequestered part of the world to free trade and flow of foreign capital. In conjunction with changing tastes, these new possibilities lead to foreign direct investment in emerging markets like India and China, speeding up the rate of global integraton.
Before 1980, less than one percent of Chinese citizens had ever tasted beer. Twenty five years later, the Middle Kingdom had surpassed America as the world’s largest beer market—and it shows no signs of slowing down. It’s the same story in Russia, a nation with vodka so integral to its historic national identity suddenly seen a generation of bar-goes opt for beer.
Meanwhile, beer consumption has declined in the traditional beer markets as each new generation of drinkers in Germany, Britain and Belgium are shifting more towards wine and mixed beverages. This global convergence of tastes has effects far beyond the cafes and pubs where it is manifest.
The convergence of taste is not only reflected in changing consumption patterns across the globe, but also in the production structure. The removal of international restrictions on trade and investments has allowed the process of consolidation that started in the early 20th century to go global at the end of the 20th century. Today, one multinational produces more than half the world’s beer.
This part will identify the main changes from the past quarter century of open markets and globally integrated brewing industry following the fall of the wall. The main points will be the “global convergence of tastes,” ie: growth of beer markets in traditional wine- and spirits-drinking nations as per capita consumption in traditional beer-drinking nations plummets and how this has coincided with major changes in the organization of the global beer industry.

Chapter 11: The Rise and Fall of the Beer-Drinking Nation
Forget lederhosen and lager pride—which nations actually drink the most beer? The Irish and Czech are tied for world class beer drinkers—unsurprising given the role that beer has played in the formation of their national identity. Germans, Brits and Belgians are not far behind. But a closer look at the data reveals overlap between nations with the biggest beer-drinkers and the quickly shrinking markets. Beer played a significant role in the rise of national power in these traditional drinking cultures. Now the question is: is globalization bringing about an end to the “beer-drinking nation” as we know it through cultural tropes? Will future generations of Germans and Irish retain their ancestors loyalty to the national beverage?
This chapter will interweave data pointing to a “global convergence of tastes,” with stories from biggest beer-drinking nations on decline of tradition in alcohol consumption habits.

Chapter 12: Socialist Lubricant:
How the Brewing Industry Eased Eastern Europe’s Free Market Transition
Free markets work great in theory, but there’s nothing like the economic aftermath of 1989 economic reforms demonstrate just how messy they can get in practice. Across the former Eastern Bloc, previously subsidized barley farmers found themselves in a credit vacuum and their crop prices in a tailspin. But by the mid-90s, an unlikely hero came out of the woodwork: while banks were less than reluctant to lend to a sector in decline, the brewing industry was the first to attract foreign direct investment (FDI). When multinationals like Heineken scrambled to invest in formerly state-owned brewers and malt houses, they learned that first they’d have to repair the supply chains all the way up to farmer co-ops if they wanted to eventually become profitable operations.
This chapter will narrativize the role foreign direct investment played in repairing the supply chains for farmers in post-Communist nations.

Chapter 13: How the Belgian Beer Barons Dethroned the King
It’s a story of the mouse eating the elephant: In the throes of the 2008 financial crisis, at some point the hostile takeover of Anheuser Busch by Belgian-Brazilian multinational InBev caught America by surprise. Twenty years earlier, Anheuser Busch was twenty times the size of Belgian firm Interbrew and the largest brand in the world. Popular books Dethroning the King and Bitter Brew have documented the fall of an American icon, the fatal mistakes and tumultuous father-son relationship between August Busch the Third and Fourth, but there are some bigger forces at play…
Using the intertwining stories of Anheuser Busch and InBev, this chapter will describe the shift from domestic consolidation to global integration that has taken place in the past 20 years. The key thread to follow will be how American firms grew organically through expansion of their brands in the world’s largest beer market, while the era of global integration has been marked by mergers, acquisitions, and forced divestitures in nations with previously concentrated beer markets.

Chapter 14: Teetotal Recall:
Can A Nation of Abstainers Learn to Love Beer?
India has a long history of temperance. The teachings of Gandhi made abstinence political, a way to drain revenue from British imperialist powers. But recent loosening of alcohol regulation has spurred Western investors to take a gamble on the Indian beer market. SABMiller especially has stepped in to improve barley supply chains and update technology. Their motivations are similar to those wishfully eyeing the Chinese beer market: if every citizen bought just one of their beers… For now, India still has the lowest per capita consumption in the world. But will this change?
This chapter will describe recent changes in alcohol regulation in India, and the role of foreign direct investment in updating supply chains.

Chapter 15: Beijing Beer Wars:
Why the West Won't Get the Chinese Beer Market Until They "Get" the Chinese Beer Market
Globalization is the name of the game, but the biggest beer market in the world also happens to be one of the biggest exceptions: China. It’s not for lack of trying that western firms have failed to claim their stake in China. Following economic reforms, Western entrepreneurs lined up to invest in the most popular Chinese breweries, bringing with them efficient technologies and advertising campaigns. A Western-style upgrade brought sales of former market leader Five Star to new lows, while state-owned breweries co-opted technology brought about by foreign money. The bottom line: Chinese drinkers don’t want quality beer with great marketing, they want the cheapest beer possible.
This chapter will offer a brief history of the forces leading to an explosion in beer consumption in China after the economic reforms of 1978, then explain why the biggest beer market in the world has failed to globalize.

Chapter 16: From Vodka to Baltika:
Deciphering Russia's Recent Love Affair With Beer
For as long as cyrilic has permitted Siberians to make permanent their literary philosophies, Russian writers have been in an abusive relationship with vodka. But in 1994, the nation had a sudden and passionate fling with beer. A hockey stick curve in consumption patterns is remarkable: in just seven years, the Russian beer market quintupled. Why? It started with a technicality… New regulations limiting the advertisement and sale of alcohol were designed to curb the rising mortality rate. When they passed, a few brewers identified a happy loophole: in Russian law, beer wasn’t categorized officially as “alcohol.” But was such a misunderstanding alone enough to cause the dramatic spike in beer consumption? Or were there more forces at work?
This chapter will use recent explosion in Russian beer market to discuss the role of peer effects in beer consumption. Russia is used as a case study for how consumption patterns can change on a local and national level—economic studies suggest that the increase in beer consumption hasn’t caught on randomly, but rather based on geographic concentration and critical mass of beer drinkers.

PART FOUR
FROM LAND TO BRAND

There’s no better example than AB InBev claiming half the world’s beer to illustrate just how dramatically a globalizing world has impacted the brewing industry. Beer is one of the earliest non-new industries to achieve the level of global market concentration that it has. But what does this really mean? “Globalization” is an oft-used word encompassing simultaneous sweeping changes in the political economy post-1989, and one that can at times be just a little too convenient. After all, what is “market power” if not a force to be seen and felt and tasted in the offerings of local happy hour haunts? As an ancient and politically charged commodity, beer offers a unique lens to understanding how local rituals and regulations are both succumbing and resisting the forces of globalization.
Since the early modern period in Europe, political rulers have secured income by claiming control of the land and its fruits. Today, this happens in court battles over trademarks and copyrights. With a beverage as old and politically charged as beer, a long and storied history has influenced the direction of globalizing markets. This section traces three case studies in how generations-old disputes over land have influenced the outcomes of disputes over brand.

Chapter 17: Competition or Contamination:
Germany’s Ancient Purity Law Comes Under Fire
Germans are serious people. They’re serious about their laws, and their serious about their beer. So their beer laws? Well… Germany is home to the world’s oldest food regulation still in effect, the 1516 Reinheitsgebot mandating bottom-fermenting beer be produced with only hops, barley, and water. It’s a simple enough edict, but its implications have varied wildly at different points in history. First, a royal monopoly on top-fermenting wheat beer funded the counterreformation during the 17th century. Then, a law that started as a consumer protection mandate transitioned to protectionist policy.
This chapter touches upon the politics surrounding the Reinheitsgebot at several different points in history: original passage, re-codification at various points in Germany’s unity, and its function today as a “mark of quality” for German beer.

Chapter 18: Bud Out:
Tradition, Terroir, and a Transcontinental Trademark Dispute Over “Budweiser”
The “Battle of the Buds” is frequently cited case study in international trademark dispute. There’s no clear answer: American Budweiser the first registered brand name, but Czech city of Ceske Budejovice is historically German “Budweis.” The past decade the two firms have seen 124 decisions issued, with 61 suits currently in progress in eleven nations. But preceding the great Czech-American Budweiser dispute, the breweries in question were at the center of nationalist tensions between Czech-speaking peasants and German-speaking burghers leading up to World War I.
This chapter will trace the fight over “Budweiser” back to the nineteenth century, partially drawing from history of the city Budweis, and partially from recent legal analyses of geographical indication. The thread will be the change in political economy of beer from control of land to brand—drawing contrast between early industrialist America and feudalist Bohemia in the Holy Roman Empire, to Communist Czechoslovakia and beyond.

Chapter 19: Gaarden Variety:
Who Decides the Difference Between hoegaardes, Hoegaarden™ and “Belgian-Style White”?
On every bottle of Hoegaarden white beer are two intertwined symbols: one of a bishop’s staff, the other of a brewer’s paddle. It’s seal for the tiny Brabantian village of Hoegaarden, but its also trademark property of multinational giant AB InBev, owner of the village’s namesake white beer. Hoegaarden’s history as a brewing center dates back to the fifteenth century, when its unique tax status—an enclave belonging to the Prince Bishopric of Liege, surrounded by French Burgundy—afforded it success exporting beer to nearby towns. Its motto is “Hoegaarden beer is forever.” Just imagine the outrage when AB InBev announced they were moving production of Hoegaarden beer outside of the city.
This chapter will trace the evolution of the Belgian-style white style of beer from Hoegaarden’s tax exemption, AB InBevs acquisition and the controversy it inspired, but also the success of the style in the United States with brands such as Blue Moon and Shock Top.

PART FIVE
A COUNTERREVOLUTION IS BREWING

Industrialization, consolidation, global integration… First the breweries get bigger, then the number of breweries gets smaller, then, repeat on a global scale. The industrial revolution made beer profitable, but also lead to profit-driven brewers. And for a century, traditional beer-drinking nations opted for the cheap and consistent offerings of large-scale breweries. But sometime around the late 1970s, a change of current begun to take hold in these nations… Increased patronage of small, local breweries, a willingness to spend more money for less beer, and a sparked interest in traditional brewing techniques and styles with stronger flavors than the industrial light lager. In the United States, this has manifested through the popularity of hoppy Indian Pale Ales, while in Belgium, the fastest growing domestic sector has been abbey and Trappist ales the past two decades. But does this trend reflect a return to medieval beer markets that had been swept away by the twin tides of industrialization and consumerism, or is our obsession with craft beer built on mere romantic nostalgia? The truth, as it turns out, lies somewhere in the middle: the craft beer boom claims a relationship with tradition, but it is also a distinctly twenty-first century phenomenon—a reaction to mass-produced, industrial beer, but one that makes effective use of tools from the scientific revolution in brewing.
This section will compare specialty beer movements in three traditional beer-drinking nations—US, Belgium and Germany, discussing the ways in which each nation’s respective rate of consolidation has impacted its current craft countermovement.

Chapter 20: Anything Gueuze:
How Belgium’s “Peasant Beers” Became Pride of the Nation
Belgian beers have gotten their fair share of hype in recent years. Following the publication of Beer Hunter Michael Jackson’s Great Beers of Belgium, connoisseurs from as far as Japan and South America have been flocking to the tiny nation for beer tours of its oldest breweries. Indeed, the diversity of styles in Belgium is indisputable, from the sour gueuzes and krieks to the sweet abbey ales. But what connoisseurs don’t know is that these beers were not great or even considered good as recent as the 1970s and 80s. The regional styles so adored today were called “peasant beers” by fans of industrially produced, cheap and consistent lagers Stella Artois.
This chapter intertwines the anecdotes of Belgian brewers with data on Belgium’s export market to narrate Belgium’s pioneering role in the emerging value-added market for beer.

Chapter 21: Hop Heads and Locaholics:
Strategies of the American Craft Beer Movement
The craft beer movement has been framed as a counterrevolution to industrial brewing, a triumph of locavorism. And the recent popularity of the craft sector is truly remarkable, posting double-digit growth in face of the 2008 recession despite much higher prices than industrial competitors Bud, Miller and Coors. But what, really, is the reason why small local breweries suddenly became a viable business model when it did? In the US, the story begins with a change in tax law passed by Jimmy Carter in 1979, and continues with the strategic business models of early leaders: contract brewing to counter high fixed costs and the success of grassroots marketing campaigns. But now the underdogs are facing a paradox: what happens when David becomes Goliath?
This chapter will describe the rise of the craft beer sector in America since the 1990s, in addition to raising questions surrounding the definition of “craft,” and the controversy surrounding “faux craft.”

Chapter 22: The Land of Lost Time and Regional Breweries:
Woes of the German Brewing Industry
German brewers have fallen on dark times, and the foreseeable future doesn’t look any brighter. Its population is declining while the next generation of drinkers are opting for wine and spirits in accordance with the “global convergence of tastes.” But while Belgium has successfully marketed itself as “craft nation,” exporting high-value beers around the world, Germany’s remained a fortress for traditional Reinheitsgebot pilsners and thick reusable bottles.
This chapter will contextualize woes of German beer market with the nation’s history: why the beer markets are declining, and strategies employed by successful brewers to employ Germany’s historic quality marketing their product.


Recent Projects:

I have published more than 10 academic books (both as editor and author), including with Oxford University Press and Cambridge University Press. The most relevant for this new project is an edited volume for an academic audience: “The Economics of Beer”.
I have written several shorter pieces for wider audiences, but this is my first book for a wider (non academic) audience. For this I have teamed up with a journalist, Devin Briski, to ensure that the book will be easily accessible and attractive reading for a wide audience.

Experience, Credits and/or Awards:

Johan Swinnen is an economist driven by the notion that beer is serious and should be treated as such. Unsurprisingly, he’s Belgian. He is professor at the University of Leuven and Stanford University, and worked for the World Bank and other international organizations. He is president of the International Association of Agricultural Economists. He is also founder and president of the Beeronomics Society. Besides many other books, he edited The Economics of Beer published by Oxford University Press and hosted the first (and now bi-annual) Beeronomics Conference.

Devin Briski is a journalist and recent graduate of Columbia University who has cultivated a fluency in both dry, technical academic writing and readable prose of human-interest features. She’s written about various topics (including beer) for the Columbia newspaper (including as food & drink editor) and at Eater (New York) during the summer of the beer garden.