Federal Reserve Chair Ben Bernanke famously commented that understanding the Great Depression is the Holy Grail of macroeconomics (“The Macroeconomics of the Great Depression: A Comparative Approach.” Journal of Money, Credit and Banking 27, no. 1 [1995]: 1–28). Much attention has been devoted to how monetary and fiscal factors shaped the economic dynamics of the period. More recent work has emphasized the importance of expectations, particularly how these policies may have led to a dramatic positive shift in sentiment.

The Brew Deal: How Beer Helped Battle the Great Depression, by Jason E. Taylor, offers a new take on the recovery from the Great Depression by emphasizing the role of Prohibition and its repeal. The book is designed for a general audience and so leans on qualitative arguments and historical anecdotes. Taylor structures the book into three parts: the background of Prohibition, the immediate effect of Repeal on the economic recovery, and a deeper dive into how the brewery revival was financed. It is an engaging book rife with anecdotes on breweries’ responses to Prohibition and its repeal.

Taylor first considers the passage of the 18th Amendment during the 1920s (Chapters 1–3). The ambiguous text of the 18th Amendment outlawing “intoxicating beverages” sets the scene. The amendment implied that the more restrictive definition of the term under either federal or state law would define prohibited drinks. Congress, through the Volstead Act, set the definition of “intoxicating beverages” to any drink over 0.5 percent ABV, effectively eliminating alcoholic beverages. Throughout the 1920s, various attempts to loosen this definition failed. Hoover’s 1928 presidential victory was seen as the decisive triumph for the dry (pro-Prohibition) movement.

However, public opinion quickly began to shift, and Taylor next describes the Repeal process and its immediate effect (Chapters 4–6). The Democratic platform for the 1932 election explicitly called for Repeal, and Roosevelt’s election raised market expectations for a wet (anti-Prohibition) victory and a brewery revival. Indeed, shortly after Roosevelt’s inauguration, Congress and Roosevelt loosened the Volstead Act definition of “intoxicating beverages” to beverages above 3.2 percent ABV, leading to the creation of so-called 3.2 Beer. Sales began on 7 April 1933, and Taylor describes at length the various “Brew Year’s Eve” celebrations across the country. Importantly, many states were unable to participate in celebrations on 7 April due to differing state-level definitions of “intoxicating beverages.” While the stories add color and are a fascinating window into a rare jovial moment of the period, the narrative at times gets bogged down by an abundance of examples. Rather than discuss states individually, it would have been interesting to paint in broad strokes what may have determined variation in state definitions. For example, did economic characteristics, such as having a larger beer industry, play an important role, or was it purely political?

With Prohibition repealed, Taylor next examines its role in the recovery from the Great Depression (Chapters 7–9). In my favorite chapter, Taylor presents his evidence for why repeal could have had such large effects. Estimates that 8.5 percent of federal government receipts in 1933 came from Prohibition reform lend credence to the idea that beer played a significant role in the recovery. Repeal directly generated employment opportunities across the beer production chain, including breweries, advertising, and restaurants, and contributed to a psychological uplift. Yet, how did breweries obtain financing to come back online so quickly during a national banking crisis? Other than personal wealth, Taylor identifies that equity was a key source of financing, with nearly $80 million in stock raised by the beer industry in the year following Repeal. Taylor also convincingly argues that there was no bubble behavior in either stock prices or brewery entry. Still, it remains unclear how stock issuance alone could have met the investment and, particularly, the working capital needs of breweries and retailers. The point is touched on only briefly, and more discussion would have strengthened the analysis. Finally, Taylor closes with a discussion of some lingering effects of Repeal (Chapters 10–11).

While Taylor provides plenty of interesting anecdotes and statistics to show beer’s role in the recovery, he does not attempt to quantify its aggregate effect. Instead, there are appeals to Keynesian multiplier effects as a full quantification exercise would clearly be beyond the scope of the text. There are also complications from contemporaneous government interventions, such as the National Industrial Recovery Act (NIRA) emphasized by Harold L. Cole and Lee E. Ohanian (“New Deal Policies and the Persistence of the Great Depression: A General Equilibrium Analysis.” Journal of Political Economy 112, no. 4 [2004]: 779–816). In a particularly fascinating piece of history, NIRA directly affected today’s brewing industry by cementing a three-tier system of breweries selling to distributors that sell to retailers, a system that advantaged large breweries capable of bottling and canning over smaller ones that relied on draft beer. Additionally, Taylor leaves some topics relatively unexplored. For example, there is very little on the relationship between Prohibition and the agricultural malaise of the 1920s. While Taylor does briefly mention a rise in barley and hops prices in 1933, it would be interesting to see more about whether farmers played a role in the modification and ultimate repeal of Prohibition.

This book is genuinely enjoyable to read, especially for beer drinkers and economic historians. Contemporaneous news articles, advertisements, and political cartoons are woven throughout the narrative and add color to the historical account. The narrative is further complemented by some light supporting statistics that strengthen the overall argument. Taylor convincingly reframes Repeal as more than just a cultural phenomenon; it can be seen as an economic lever in improving the economic situation of the country. Any minor complaints do not detract from this well-researched thesis of the book. Combining a clear passion for both economic history and beer, this book is a refreshing read that offers novel insight into our understanding of the era. Most importantly, I will be quite delighted to visit Minneapolis and enjoy what may be the last 3.2 bar in the country (Epilogue).