When collective action across craft breweries via a trade association was unsuccessful, individual breweries shifted lobbying from state legislative and regulatory arenas to local regulatory bodies. Swayed by a range of locally-focused social and political strategies, local officials resisted state-level restrictions on taprooms and off-site beer gardens by using multiple “one-day” event permits to license these expanded, DTC business models. The use of temporary permits for ongoing business activities pressured the state-wide regulator to loosen restrictions. Collective action was helpful, but, instead of an industry-wide coalition, individual craft breweries built up local coalitions of support including local government officials, non-profits, and non-brewery businesses. The local actions of entrepreneurs were viewed by both local and state regulators through lenses of status and reputation that supported or undermined discretionary leniency. By demonstrating how individual small businesses and local government officials impact state-level regulation, this study extends our understanding of nonmarket strategy to both smaller firms and municipal interactions. Even in a mature industry with well institutionalized, multi-level government regulations, powerful incumbents opposing changes, and minimal technological change, individual small businesses reshaped the regulatory environment of an entire state through local action.

I deliberately focused on six states without significant local regulatory authorities (to contrast with my first paper) but states with similar underlying characteristics and varied policy outcomes to support comparative analysis. I found that sustained efforts by trade association leaders with appropriate levels of social distance (not too close by owning a brewery or too distant because of a part-time position or limited industry experience) led to influence. Such leaders aligned craft breweries with diverse business models, successfully navigating among the goals of outside interests to strike palatable policy compromises and build sustained influence.

To facilitate sampling and analysis, I produced a cross-sectional database of craft beer relevant data for all 50-states, along with longitudinal databases documenting the growth of craft beer constructed from government and trade association records, including over 5,000 legislative updates on proposed and enacted federal and state policy changes over the last 20 years collected from the national craft beer trade association. These data are being used along with Nielsen data from the Kilts Center for Marketing to support further, national analyses. 

Historically, a wide range of different rationales have been used to justify regulation of markets, but, since the 1980s, a rhetoric of efficiency has come to dominate modern discourse around regulation. Building on the conception of efficiency in economics, this efficiency rhetoric had led to a focus on economic growth, and to a lesser extent competition, as the sole bases for justifying market regulations. This contrasts with earlier periods, like the trust-busting era, when reining in market power, promoting competition, and supporting small businesses were the primary bases for regulation. The paper concludes by offering other potential considerations to legitimate regulatory market interventions drawn from social theory and empirical work, specifically: promoting resilience, distributing benefits and/or harms fairly, and protecting autonomy.