Beeronomics: More Potatoes and Less Meat
The Dow saw it's
largest second-largest single-day fall on record today, but what about beer? The good professor has our backs in his periodic beeronomics series.
Wow, sales are up 11%! One could possibly infer from this that craft beer, like macrobrews, are an inferior good (in the economics sense, not in the real sense). This means that as incomes fall, you actually consumer more. The classic example of this are the potatoes in the aforementioned meat and potatoes meal. As incomes get tight the plate becomes more potatoes and less meat (and vice versa when people are flush). Perhaps craft brew becomes a substitute for fine wine, scotch and the like. Of course it is more likely that demand just continues to rise as more and more people wake up to the fact that beer doesn't have to taste like crap (pardon me - that is an economic term of art for "Bud"). Oh and what about those macros? Sales are flat, just like the keg the day after the frat party. Anyway, read the WSJ article, as it addresses how brewers are coping with hops shortages and increasing input prices.It's a weird paradox, isn't it? The Wall Street Journal article Patrick quotes says that craft beer is "one of the cheaper luxury items people can buy." So for those of you who were thinking your double-fermented, dry hopped, barrel aged barleywines were a little hoity toity, take heart. They're still a bargain for luxury items.