Global Alcohol Markets: Evolving Consumption Patterns, Regulations, and Industrial Organizations

Abstract

For millennia, alcoholic drinks have played an important role in food security and health (both positive and negative), but consumption patterns of beer, wine, and spirits have altered substantially over the past two centuries. So too have their production technologies and industrial organization. Globalization and economic growth have contributed to considerable convergence in national alcohol consumption patterns. The industrial revolution contributed to excess consumption by stimulating demand and lowering the cost of alcohol. It also led to concentration in some alcohol industries, especially brewing. In recent years, the emergence of craft producers has countered firm concentration and the homogenization of alcoholic beverages. Meanwhile, governments have intervened extensively in alcohol markets to reduce excessive consumption, raise taxes, protect domestic industries, and/or ensure competition. These regulations have contributed to, and been affected by, the evolving patterns of consumption and changing structures of alcohol industries.

Asia’s Emergence in Global Beverage Markets: The Rise of Wine

“…Should the EU sign an FTA with China, for example, Europe's dominance in China's wine imports may increase, as also in Japan following the signing in December 2017 of the EU-Japan Economic Partnership agreement (Anderson and Wittwer 2018). Also important are taxes and other regulations on alcohol consumption (Anderson, Meloni and Swinnen 2018;Anderson 2020). India potentially could be much more important as an importer of beverages, but very high internal and external trade restrictions and excise taxes on alcohol have to date greatly confined the growth in sales in that populous country.…”

Agricultural exports and economic development in Spain during the first wave of globalisation

“…In the American continent, the protectionist measures to promote domestic production, both in the United States and in other countries such as Argentina or Uruguay, led to a strong fall in Spanish exports. In the markets of the industrialised countries with higher income levels, exports were enormously limited as wine had not become a mass consumer product due to a preference by their populations for other alcoholic drinks such as beer or spirits (Anderson, Nelgen and Pinilla, 2017;Anderson, Meloni, and Swinnen, 2018). These difficulties for wine in external markets are fundamental for explaining the lower growth rate of agricultural exports in the first third of the twentieth century, given the enormous share that this product had of them.…”

Consumer Taxes on Alcohol: An International Comparison over Time

“…Such externalities vary not only across countries but also across beverage types and across drinking/eating patterns (Baxter, 2019). This ensures the impact of alcohol taxes on different types of households are very uneven, given differences in consumer preferences, which evidently vary greatly both between and within countries (Holmes and Anderson, 2017; Anderson, Meloni, and Swinnen, 2018; Hart and Alston, 2019, 2020).…”