Skyscraper Height and the Business Cycle
It seems obvious there should be some relationship between the health of an economy and the willingness and ability of developers to create ever taller buildings.
Moreover, since tall buildings are often not economically sound propositions a large part of the decision to construct them must rest on hubris and trees-to-the-sky optimism; both regular harbingers of some form of economic bust. Think Empire State completed in 1931 or Burj Khalifa completed in 2010?
Should we then have paid more attention to the recent completion of China’s tallest building the Shanghai Tower (632m and to be opened soon)? Perhaps if we had the recent bumpiness in China’s stock markets might have been better anticipated?
The above is a nice idea, and one that journalists regularly warm to; but it’s also (mostly) nonsense.
The link at the top of this note will take you to a paper from Kusum Mundra, Jason Barr and Bruce Mizrach, all associated with the Department of Economics, Rutgers University in Newark that convincingly debunks the widespread notion that building height has some economic predictive ability. This notion is merely another example of our brains being largely refined to help Serengeti-Plain-wandering ancestors find meaning from surroundings.
In a neat twist the authors establish one thing though; progressing economies are reliable predictors of taller buildings. No surprise then that China’s next tallest building, the Ping An Finance Center in Shenzhen (660m) is due for completion next year. China at least really is a case of onwards and upwards.
Happy Sunday