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Modelling Brewing Industry Pricing

Keywords: Beer , Brand , Plzen sky Prazdroj , price leader , pricing policy , oligopoly.

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Abstract:

The aim of this contribution is to analyse the price behaviour of the second to eleventh strongest brewers on the Czech market on the basis of the price behaviour of the price leader, this being Plzen sky Prazdroj (a member of SABMiller). Using monthly prices (the number of observations is generally 108 periods), is modelled the length of delay between the price leader and the other breweries making a price change. A linear regressive analysis is used to produce the model. The beer brands are divided into 3 segments: super- premium, mainstream and non-alcoholic beer and prices are modelled separately for barrelled and bottled beer if the data is available to allow it. The results of each brewery’s behaviour are summarised in conclusion. The information presented in the article is the product of working on the Research Plan MSM 6046070906, “The Economics of Czech agriculture resources and their efficient use within a multifunctional agri-food systems framework”.

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