Skyscraper Height and the Business Cycle: Separating Myth from Reality

37 Pages Posted: 10 Dec 2011 Last revised: 16 Jul 2014

Jason Barr

Newark College of Arts & Sciences - Department of Economics

Bruce Mizrach

Rutgers University, Department of Economics

Kusum Mundra

Department of Economics, Rutgers University, Newark

Date Written: July 1, 2014

Abstract

This paper is the first to rigorously test how height and output co-move. Because builders can use their buildings for non-rational or non-pecuniary gains, it is widely believed that (a) the most severe forms of height competition occur near the business cycle peaks and (b) that extreme height are examples of developers “gone wild.” We find virtually no support for either of these popularly held claims. First we look at both the announcement and completion dates for record breaking buildings and find there is very little correlation with the business cycle. Second, cointegration and Granger causality tests show that height and output are cointegrated and that height does not Granger cause output. These results are robust for the United States, Canada, China and Hong Kong.

Keywords: skyscraper height, business cycle, Granger causality, cointegration

JEL Classification: E3, N1, R33

Suggested Citation

Barr, Jason and Mizrach, Bruce and Mundra, Kusum, Skyscraper Height and the Business Cycle: Separating Myth from Reality (July 1, 2014). Available at SSRN: https://ssrn.com/abstract=1970059 or http://dx.doi.org/10.2139/ssrn.1970059

Jason Barr

Newark College of Arts & Sciences - Department of Economics ( email )

360 ML King Jr. Blvd.
Newark, NJ 07102
United States

Bruce Mizrach (Contact Author)

Rutgers University, Department of Economics ( email )

75 Hamilton Street
New Brunswick, NJ 08901
United States
(848) 932-8636 (Phone)
(732) 932-7416 (Fax)

HOME PAGE: http://snde.rutgers.edu/

Kusum Mundra

Department of Economics, Rutgers University, Newark ( email )

360 ML King Jr. Blvd.
Newark, NJ 07102
United States

HOME PAGE: http://kmundra.newark.rutgers.edu

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