Rev Ind Organ (2008) 32:1–18
Firm Survival and Chain Growth in a Privatized Retail
Liquor Store Industry
Andrew Eckert · Douglas S. West
Published online: 17 April 2008
© Springer Science+Business Media, LLC. 2008
Abstract This paper uses data on liquor retailing in Alberta since privatization to
provide a description of the evolution of a privatized retail industry from the date of its
creation. As well, this paper considers which factors contribute to the survival of stores
and ﬁrms, and the growth and creation of retail liquor store chains. Location, and in
particular whether a liquor store is located in a shopping center or near a supermarket,
is associated with the survival of a liquor store.
Keywords Firm survival · Liquor store · Privatization · Retail chain ·
Shopping center · Supermarket
JEL Classiﬁcation L11 · L81
Liquor retailing in Alberta was privatized in September 1993. Under the privatiza-
tion model adopted by the Government of Alberta, liquor products are to be sold
through licensed liquor stores that have 90 percent of their sales in beverage alcohol.
By December 1995 there were 605 liquor stores operating in the province, up from
205 stores owned and operated by the Government of Alberta in 1993.
Over the next
See West (2003). Prior to privatization, the Government of Alberta had licensed a combined total of
53 wine stores and cold beer stores. West (2003) describes the retail liquor store industry in Alberta
prior to privatization as well as the privatization process. He also examines some of the economic
impacts of privatization, including impacts on the store count, product selection, price, government
revenues, employment and wages.
A. Eckert (
) · D. S. West
Department of Economics, University of Alberta, Edmonton, AB, Canada T6G 2H4
D. S. West