Acquisitions, product variety, and distribution in the U.S. craft beer industry

Though antitrust authorities have historically focused on prices in merger analyses, there is now growing interest in the impact of mergers on non‐price outcomes. In this paper, we examine the effect of horizontal mergers on product variety in the U.S. beer industry. Our difference‐in‐differences analyses provide evidence that acquired firms increase variety available to consumers by expanding into new markets, while reducing the variety of products sold in their existing markets. Back of the envelope calculations suggest that in aggregate, these acquisitions have a net positive effect on product variety.