I recently came across Derek Thompson’s article on the economics of the craft beer industry. The fact that so many small companies can thrive despite operating in a de facto duopoly where the industry leaders produce 90% of the world’s beer is quite remarkable. By creating premium products, and charging premium prices, small companies are able to survive despite lacking the economies of scale that benefit the larger firms.
When thinking about other industries that behave similarly, chocolate and coffee come to mind. I am curious to see how small firms will carve out their own niches and compete in other sectors of the economy that are currently dominated by de fact monopolies like Amazon and Google.
Please use the comments section to share your favorite craft breweries and craft beers that I should try.