Freakonomics Radio 669. Why Is 95 Percent of the World’s Bourbon Made in Kentucky?
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Apr 3, 2026 
Andrew Muhammad, a trade economist, joins Danny Kahn, a master distiller, Brad Patrick, a bourbon industry researcher, and Ken Troske, a labor economist. They dig into why Kentucky dominates bourbon, how aging and barrel rules shape the business, why a boom became a glut, and how tariffs, taxes, tourism, and canned cocktails are reshaping the market.
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Bourbon Turns Time Into A Costly Input
- Bourbon economics hinge on time because producers must age inventory for years before selling it.
- Ken Troske says most bourbon is dumped at four years, six to eight is a sweet spot, and long aging raises capital needs while still attracting over 100 Kentucky distilleries.
The Pappy Bottle That Revealed The Boom
- Ken Troske realized bourbon's boom through a Christmas bottle of Pappy Van Winkle.
- His wife first balked at $120 for 20-year Pappy, then bought it; today he says the same bottle can fetch $2,500 to $3,000.
Aging Delays Turned The Bourbon Boom Into A Glut
- Bourbon's downturn looks like a classic delayed oversupply cycle worsened by long aging times.
- Brad Patrick says distillers expanded for years, then got hit by Gen Z tastes, tariffs, health trends, cannabis, and canned cocktails while 16.1 million barrels kept aging.