Why you can't find your favorite beer

When we were in Phoenix for a conference a couple of weeks ago, several of my colleagues fell in love with Fat Tire beer. Unfortunately, when they came back to Norman, they found that they couldn't get it here. Why? The beer distributor that serves Oklahoma doesn't carry that particular brand, probably because of perverse incentives. Why are there middle men in the first place? Because it's a cushy monopoly given out by state legislators to their friends:

The 21st Amendment gives states the power to regulate the sale of alcohol within their borders. Some states decided to assume control of all alcohol sales (they’re known today as control states). Most of those that didn’t adopted laws mandating a state-based middleman between alcohol producers (brewers, distillers, wineries) and retailers (restaurants, grocery stores, liquor stores). There are some exceptions, but generally in three-tier states no one is allowed to buy directly from a producer. Everything must go through a distributor.
For decades wholesalers have quietly added 18-25 percent to every bottle of beer, glass of wine, and shot of liquor you pour down your gullet. And there's been little resistance to them, for a few reasons. First, wholesalers don’t interact with consumers. They take their markup between producer and retailer, out of the sight of the people whose money they’re ultimately taking. Second, they’re rather powerful. Alcohol wholesaling is a lucrative, concentrated industry that reaps enormous benefits from policies whose costs are spread out across the general public.

It would be much better to cut out the middlemen and put a 18-25% tax on alcohol and directly use it to fund state government.


  1. Actually you can't get Fat Tire in Oklahoma because it's supposed to stay refridgerated.

  2. Actually, its sold in Santa Fe (the old homestead) unrefrigerated in many places - so I'm not buying that Anonymous. It is definitely sold dry in chains like World Market and Trader Joes. Happy to bring some back for your friends Lak from my spring visit.

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