Kuznets swing
Cycle/wave name | Period (years) |
---|---|
Kitchin cycle (inventory, e.g. pork cycle) | 3–5 |
Juglar cycle (fixed investment) | 7–11 |
Kuznets swing (infrastructural investment) | 15–25 |
Kondratiev wave (technological basis) | 45–60 |
The Kuznets swing (or Kuznets cycle) is a claimed medium-range economic wave with a period of 15–25 years identified in 1930 by Simon Kuznets.[1] Kuznets connected these waves with demographic processes, in particular with immigrant inflows/outflows and the changes in construction intensity that they caused, that is why he denoted them as "demographic" or "building" cycles/swings. Kuznets swings have been also interpreted as infrastructural investment cycles.[2]
Some modern economic commentators argue the Kuznets swing reflects an 18-year cycle in land values.[3][4] Fred Harrison argues this cycle of boom and bust could be smoothed or avoided altogether by levying an annual tax on the value of land (land value tax).[5]
Kuznets' analysis was criticized by Howrey (1968).
References
- ^ Kuznets S. Secular Movements in Production and Prices. Their Nature and their Bearing upon Cyclical Fluctuations. Boston: Houghton Mifflin, 1930.
- ^ See, e.g., Forrester J. W. New Perspectives on Economic Growth. Alternatives to Growth – A Search for Sustainable Futures / Ed. by D. L. Meadows. Cambridge, MA: Ballinger, 1977. P. 107–121; Korotayev, Andrey V., & Tsirel, Sergey V. A Spectral Analysis of World GDP Dynamics: Kondratieff Waves, Kuznets Swings, Juglar and Kitchin Cycles in Global Economic Development, and the 2008–2009 Economic Crisis. Structure and Dynamics. 2010. Vol.4. #1. P.3-57.
- ^ "The Great 18-Year Real Estate Cycle". Cato Institute. January 22, 2010.
- ^ "Why we must halt the land cycle". Financial Times.
- ^ Harrison, Fred (April 11, 2005). "Fred Harrison: Want to get rid of boom and bust? Tax land, not income". The Guardian.
- ^ Howrey, E. "A spectrum analysis of the long swing hypothesis." International Economic Review. 9:228-252. 1968.
- ^ Cogley, Timothy and Nason, James M. "Effects of the Hodrick-Prescott filter on trend and difference stationary time series: implications for business cycle research." in Real Business Cycles: A Reader. eds. James Hartley, Kevin Hoover, and Kevin D. Salyer. 1998. p. 636.
- ^ Korotayev, Andrey V., & Tsirel, Sergey V. A Spectral Analysis of World GDP Dynamics: Kondratieff Waves, Kuznets Swings, Juglar and Kitchin Cycles in Global Economic Development, and the 2008–2009 Economic Crisis. Structure and Dynamics. 2010. Vol.4. #1. P.3-57.