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JUE Insight: Shovel ready projects and commercial construction activity’s long and variable lags

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  • Glancy, David
  • Kurtzman, Robert
  • Loewenstein, Lara

Abstract

We use microdata on the phases of commercial construction projects to document three facts regarding the sector’s time-to-plan lags: (1) plan times are long and highly variable, (2) nearly half of projects in planning are abandoned, and (3) property-price appreciation reduces the likelihood of abandonment. We present a tractable model of endogenous planning starts and abandonment that can match these facts. The model has the testable implication that supply is more elastic when there are more “shovel ready” projects ready for construction. We use local projections to validate this prediction in a panel dataset for US cities.

Suggested Citation

  • Glancy, David & Kurtzman, Robert & Loewenstein, Lara, 2026. "JUE Insight: Shovel ready projects and commercial construction activity’s long and variable lags," Journal of Urban Economics, Elsevier, vol. 151(C).
    • Handle: RePEc:eee:juecon:v:151:y:2026:i:c:s0094119025000816
    DOI: 10.1016/j.jue.2025.103816
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    Keywords

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    JEL classification:

    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • L74 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Construction

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