| dc.description.abstract | This dissertation asks how do small firms overcome regulatory constraints despite powerful opposition? Significant research has documented the nonmarket strategies of large, multinational firms seeking to benefit from and capture regulatory systems. However, despite the historically important role of small and medium-sized enterprises (SMEs) in the economic and civic structures of the US, there is much we do not know about whether and how they attempt to exert their own influence in regulatory environments. To explore this, the US beer industry was selected as a strategic research site where SMEs have had a range of successes and failures in developing policy influence. In the late 1970s, the US beer industry rapidly consolidated to less than 100 breweries, but today, with the rise of small, craft breweries, there are over 9,000 breweries in the US. Over 7,000 of these focus on direct-to-consumer (DTC) sales, which were explicitly or practically illegal in all 50 states in 1980. How did this market and regulatory transformation take place and why did some states significantly change their policies to support small brewers while others did not? Two studies were conducted to explore this, an in-depth qualitative study of a single state and a mixed-methods comparative study of six states. The single state was selected for variation in policy outcomes over time and at local levels. Through interviews and archival research, it was revealed that craft breweries engaged in a bottoms-up approach, through which individual firms venue shift downwards, from state to local regulators, to successfully ease state-level constraints. In local public hearings, individual entrepreneurs blended local corporate social responsibility (CSR) with an experimental approach to corporate political activity (CPA) that motivated city-based regulators to challenge state-level restrictions on DTC business models. To understand how this process of developing policy influence unfolds in the absence of local regulators, the national trade associations in the beer industry were analyzed and six states where the state has near exclusive control over alcohol regulations were selected for further analysis. Controlling for a range of factors through a cross-sectional database led to a geographically proximate sample of six comparable states with wide variation in the favorability of policies and the number of breweries per capita. A unique dataset of over 5,000 legislative updates on proposed and enacted federal and state policy changes was supplemented with archival and interview data to assess policy influence. The conventional approach described in the literature, collective action via a trade association, was important but often insufficient. Each state had a functioning trade association representing most craft breweries, but sustained policy influence was observed only in states where full-time leaders of these associations understood the political landscape and developed policy partnerships to tilt the odds in their favor. Policy partnerships entailed legislation alleviating regulatory constraints while also including new provisions that ensured long-term alignment among the partners. Taken together, these studies reveal the vital importance of collective action extending beyond the focal industry for SMEs to develop policy influence at the local or state level. | |
