Seasonal Cycles in the Housing Market: Patterns, Costs, and Policiesby Kenneth T. Rosen, Edward W. Brooke
"Rosen begins his work by carefully examining the pattern of seasonal
Edward Brooke, who served as the ranking minority member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, writes that "Kenneth Rosen has in this volume provided a unique set of analyses concerning the causes and costs of the seasonal cycle in new home production.
"Rosen begins his work by carefully examining the pattern of seasonal fluctuations in housing markets. He finds that seasonal fluctuations are still a pervasive characteristic of housing markets in nearly all parts of the country. This seasonal decline in activity leads to substantial unemployment and underutilization of capital resources in winter periods. In turn this reduces the efficiency of housing construction and so adds to cost pressures in the housing market.
"Rosen then goes on to challenge the conventional wisdom that bad weather is the prime cause of seasonality. He argues that a seasonal peak in the demand for housing, as reflected in the summer surge in household moves and marriages, is the primary cause of the seasonal pattern observed in the housing market. This careful insight into the demand and supply elements of seasonality should provide policymakers with the knowledge needed to moderate at least some of the cost pressures facing the housing market.
"The policy portion of this work focuses on several ways in which the costs of seasonality can be moderated. The author first suggests modifications of the state unemployment insurance and the workmen's compensation systems which would improve the efficiency of the industries' decision-making process with respect to the seasonal problem. Second, he suggests ways in which the seasonal pattern of demand could be shifted and winter home building encouraged. His analysis of the Canadian and Norwegian Winter Incentive Programs indicates that a small economic incentive can alter the seasonal pattern of production and lead to a reduction in the winter unemployment problem....
"This book follows on several other important policy proposals authored by Rosen which have received national attention, thus contributing to his growing reputation as one of our leading housing and urban policy analysts. His talent for translating economic research into practical housing policy proposals has prompted members of Congress and cabinet officers to seek his counsel, though he is not yet thirty years of age. The impact of his thinking on our nation's housing policies in yeras to come is likely to be profound."
Almost sixty years ago, Herbert Hoover, then a member of the Commission on Seasonal Operation of the Construction Industries, noted that "bad weather is not the principal cause of seasonal idleness in construction." It is rather "a matter of custom and habit not climatic necessity." Given the advances in building technology that have been made since then, this is even more true today. Rosen urges the nation to break the "habit."
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