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 Simon Smith Kuznets ( ; rus, Семён Абра́мович Кузне́ц, p=sʲɪˈmʲɵn ɐˈbraməvʲɪtɕ kʊzʲˈnʲets; April 30, 1901 – July 8, 1985) was a Russian-born American economist and statistician who received the 1971 Nobe ...

. 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 Cycle, cycles, or cyclic may refer to: Anthropology and social sciences * Cyclic history, a theory of history * Cyclical theory, a theory of American political history associated with Arthur Schlesinger, Sr. * Social cycle, various cycles in ...

/swings. Kuznets swings have been also interpreted as infrastructural

investment Investment is traditionally defined as the "commitment of resources into something expected to gain value over time". If an investment involves money, then it can be defined as a "commitment of money to receive more money later". From a broade ...

cycles. Some modern economic commentators argue the Kuznets swing reflects an 18-year cycle in land values. 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 A land value tax (LVT) is a levy on the value of land (economics), land without regard to buildings, personal property and other land improvement, improvements upon it. Some economists favor LVT, arguing it does not cause economic efficiency, ec ...

). Kuznets' analysis was criticized by Howrey (1968). Howrey claimed that the apparent business cycle found by Kuznets was an artifact of the filter Kuznets used. Howrey suggested that the same cyclical pattern could be found in

white noise In signal processing, white noise is a random signal having equal intensity at different frequencies, giving it a constant power spectral density. The term is used with this or similar meanings in many scientific and technical disciplines, i ...

series when the Kuznets filter was applied.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.

References

{{instecon Business cycle theories