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Mark Thornton on New York’s Contribution to the Ill-fated Skyscraper Race

November 16, 2013 in Economics

By Mises Updates


Writes Robyn Blumenthal at Barron’s today:

The index argues that record-tall buildings are evidence of a business cycle peaking out and thus predict economic distress. The index has seemingly been on the mark at times. Lawrence claims record buildings foreshadowed the Panic of 1907 (New York’s Singer and Met Life towers), the Great Depression (the Empire State Building), the Asia Crisis (Malaysia’s Petronas Twin Towers) and Great Recession (Dubai’s Burj Khalifa).

One fan is Mark Thornton, a senior fellow at the Ludwig von Mises Institute in Auburn, Ala., who recently penned a paper titled “Skyscraper Curse to Hit New York.”  Thornton applies Austrian business-cycle theory to big buildings. “You’re seeing these symbolic points of information coming out,” he says.

See Mark Thornton’s Mises Daily article on the Skyscraper Curse posted today:

It is now official! New York City has won the title of having the nation’s tallest structure. The heated controversy between New York and Chicago was settled recently when the Council of Tall Buildings and Urban Habitat (based in Chicago) decided that the 408-foot spire sitting atop the One World Trade Center could be included in the total height of the building.

The Curse originated during the Panic of 1907. Two skyscrapers were under construction during this time, the Singer Building opened in 1908 and the Metropolitan Life Building opened in 1909, and each would become the world’s tallest. In 1929, America’s Great Depression was ushered in with the opening of the 40 Wall Street Building (currently the Trump Building), then came the Chrysler Building in 1930, and the Empire State Building in 1931. The booming 1960s was followed by the stagflation of the 1970s and saw more record-setting skyscrapers being built with inflated money, among them World Trade Towers 1 & 2 and the Sears Building which all opened in the early 1970s.

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