When newcomers cannot break with authenticity: identity implications in the Franconian beer industry

In this paper we explore the implications of authenticity on entrepreneurial activity. Authenticity is seen as an intersection point between producers’ efforts and audience claims to preserve traditional attributes in a market. Both, relative prevalence of authentic attributes among producers as well as audience members’ quest for authenticity are expected to reduce market attractiveness for newcomers who cannot improvise authenticity and thereby, market entry is discouraged. In turn, locations where there are few commitments to authenticity from the supply and the demand side are thought to represent more opportunities for newcomers and therefore, stimulate market entry. We test our arguments in the microbrewery industry in Franconia (Germany) during the period 1989-2012. Our findings suggest that entrepreneurial action in a county is constraint as producers and audience’ commitments to authenticity increase. Implications for the study of identity as well as for the fields of economic geography and entre...