This paper aims to investigate the locational determinants of the craft beer industry in Budapest, Hungary, between 2009 and 2022.
The authors use various count data models to determine the relationship between the number of microbreweries and locational factors.
The authors find that demand and supply-side factors, including income, unemployment, level of education, population density and the number of local businesses, affect the number of craft breweries. Whilst agglomeration effects proxied by breweries per capita in a district have a positive coefficient, the number of breweries in neighbouring districts is not significant. In addition, the authors do not observe any negative impact of COVID-19-related restrictions. The picture of a still-evolving, resilient craft beer sector emerges from our analysis.
To the best of the authors’ knowledge, this is one of the first specific studies on the craft beer sector in the Central and Eastern European region and the first to evaluate the location choices of craft breweries in Hungary within a municipality using an up-to-date data set. The authors’ analysis covers 14 years, from the early stages of craft brewery proliferation in Budapest until 2022, testing several hypotheses with respect to the location choices of these businesses.
