The Swedish building cycle and other cycles

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Abstract
This article discusses long‐term fluctuations in Swedish building and construction activity during the period 1850–1985. It concentrates on the last 35 years. A study of the “classical” Kuznets cycle is worked out. The mechanisms which before World War I caused a long swing in building and construction in Sweden are shown here to be of some relevance for the period after World War II as well. Now, as then, the building cycle is linked to a long fluctuation in population and in investments in manufacturing activities. Some differences are observed; Prior to World War I the fluctuating aggregate number of young people was a significant long swing variable. Furthermore, the general long swing in different countries was connected by emigration, capital movements and trade. Subsequent to 1945 transfers of technology have become a significant link mechanism. Furthermore the very strong fluctuation in the number of young and highly trained, became a new important element. The period 1952–1982 exhibited a coherent swing in building and construction. Demographic developments and the interaction of the labour market and the educational apparatus make subsequent swings plausible. The 1980s is probably experiencing an upswing phase of a building cycle—and hence an upswing in general capital formation.

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