IDEAS home Printed from https://ideas.repec.org/a/eee/juecon/v64y2008i1p49-64.html
   My bibliography  Save this article

A game-theoretic analysis of skyscrapers

Author

Listed:
  • Helsley, Robert W.
  • Strange, William C.

Abstract

Skyscrapers are urbanism in the extreme, but they have received surprisingly little direct attention in urban economics. The standard urban model emphasizes differentials in access across locations, which determine land price differentials and building heights. This explanation leaves out an important force that appears to have historically influenced skyscraper construction: an inherent value placed on being the tallest. In this paper, we present a game-theoretic model of skyscraper development that captures this additional force. The model predicts dissipative competition over the prize of being tallest, a prediction consistent with the historical record. The paper discusses the implications of this result for the nature and efficiency of urban development and for the operation of urban real estate markets.

Suggested Citation

  • Helsley, Robert W. & Strange, William C., 2008. "A game-theoretic analysis of skyscrapers," Journal of Urban Economics, Elsevier, vol. 64(1), pages 49-64, July.
  • Handle: RePEc:eee:juecon:v:64:y:2008:i:1:p:49-64
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0094-1190(07)00095-2
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Arthur M. Sullivan, 1991. "Tall buildings on cheap land: Building heights and intrabuilding travel costs," Journal of Urban Economics, Elsevier, vol. 29(3), pages 310-328, May.
    2. Baye, Michael R & Kovenock, Dan & de Vries, Casper G, 1993. "Rigging the Lobbying Process: An Application of the All-Pay Auction," American Economic Review, American Economic Association, vol. 83(1), pages 289-294, March.
    3. Dan Kovenock & Michael R. Baye & Casper G. de Vries, 1996. "The all-pay auction with complete information (*)," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 8(2), pages 291-305.
    4. Duranton, Gilles & Puga, Diego, 2004. "Micro-foundations of urban agglomeration economies," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 48, pages 2063-2117, Elsevier.
    5. Brueckner, Jan K., 1980. "A vintage model of urban growth," Journal of Urban Economics, Elsevier, vol. 8(3), pages 389-402, November.
    6. Robert W. Helsley & William C. Strange, 2007. "Urban interactions and spatial structure," Journal of Economic Geography, Oxford University Press, vol. 7(2), pages 119-138, March.
    7. Grimaud, A., 1989. "Agglomeration economies and building height," Journal of Urban Economics, Elsevier, vol. 25(1), pages 17-31, January.
    8. Rosenthal, Stuart S. & Strange, William C., 2004. "Evidence on the nature and sources of agglomeration economies," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 49, pages 2119-2171, Elsevier.
    9. Helsley, Robert W. & Strange, William C., 1994. "City formation with commitment," Regional Science and Urban Economics, Elsevier, vol. 24(3), pages 373-390, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Skyscrapers and Cities: A Q&A Interview with Edward Glaeser (Part I)
      by Jason Barr in Skynomics Blog on 2018-09-05 12:06:05
    2. The Economics of Skyscraper Height (Part II)
      by Jason Barr in Skynomics Blog on 2019-01-03 13:59:59
    3. The Economics of Skyscraper Height (Part III)
      by Jason Barr in Skynomics Blog on 2019-01-21 14:01:34
    4. The Technology of Tall (Part III): Getting to the Core
      by Jason Barr in Skynomics Blog on 2019-10-23 12:27:08
    5. Skyscraper Bottlenecks (Part I): The Elevator
      by Jason Barr in Skynomics Blog on 2020-02-10 13:28:15
    6. Boon or Boondoggle? The Long Run Economics of the Empire State Building
      by Jason Barr in Skynomics Blog on 2020-08-17 12:28:49
    7. Why Doesn’t New York Construct the World’s Tallest Building Anymore?
      by Jason Barr in Skynomics Blog on 2020-12-23 13:17:41
    8. Clouds in Your Coffee? Skyscrapers and their Symbolic Heights
      by Jason Barr in Skynomics Blog on 2021-01-20 13:17:39

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Valentina Antoniucci & Giuliano Marella, 2014. "Torri incompiute: i costi di produzione della rigenerazione urbana in contesti ad alta densità," SCIENZE REGIONALI, FrancoAngeli Editore, vol. 2014(3), pages 117-124.
    2. Michael Baye & Dan Kovenock & Casper Vries, 2012. "Contests with rank-order spillovers," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 51(2), pages 315-350, October.
    3. Jason Barr, 2013. "Skyscrapers And Skylines: New York And Chicago, 1885–2007," Journal of Regional Science, Wiley Blackwell, vol. 53(3), pages 369-391, August.
    4. Jason Barr, 2010. "Skyscrapers and the Skyline: Manhattan, 1895–2004," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 38(3), pages 567-597, September.
    5. Arvydas Jadevicius, 2016. "Skyscraper indicator and its application in the UK," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 4(2), pages 37-49.
    6. Nestor Garza & Colin Lizieri, 2012. "Skyscrapers and the economy," ERSA conference papers ersa12p414, European Regional Science Association.
    7. Federico Curci, 2015. "The taller the better? Agglomeration determinants and urban structure," ERSA conference papers ersa15p991, European Regional Science Association.
    8. Jason Barr, 2012. "Skyscraper Height," The Journal of Real Estate Finance and Economics, Springer, vol. 45(3), pages 723-753, October.
    9. Liu, Crocker H. & Rosenthal, Stuart S. & Strange, William C., 2020. "Employment density and agglomeration economies in tall buildings," Regional Science and Urban Economics, Elsevier, vol. 84(C).
    10. Koster, Hans R.A. & Rietveld, Piet & van Ommerren, Jos N., 2011. "Is the sky the limit? an analysis of high-rise office buildings," LSE Research Online Documents on Economics 58467, London School of Economics and Political Science, LSE Library.
    11. Ahlfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2019. "The economic effects of density: A synthesis," Journal of Urban Economics, Elsevier, vol. 111(C), pages 93-107.
    12. Ilir Nase & Nick van Assendelft & Hilde Remøy, 2019. "Rent Premiums and Vertical Sorting in Amsterdam’s Multi-Tenant Office Buildings," The Journal of Real Estate Finance and Economics, Springer, vol. 59(3), pages 419-460, October.
    13. Hanlon, W.Walker & Heblich, Stephan, 2022. "History and urban economics," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    14. Jason Barr & Jingshu Luo, 2021. "Growing Skylines: The Economic Determinants of Skyscrapers in China," The Journal of Real Estate Finance and Economics, Springer, vol. 63(2), pages 210-248, August.
    15. Jayson Danton & Alexander Himbert, 2017. "Residential Vertical Rent Gradients in the City," Cahiers de Recherches Economiques du Département d'économie 17.11, Université de Lausanne, Faculté des HEC, Département d’économie.
    16. Prashant Das & Patrick Smith & Paul Gallimore, 2018. "Pricing Extreme Attributes in Commercial Real Estate: the Case of Hotel Transactions," The Journal of Real Estate Finance and Economics, Springer, vol. 57(2), pages 264-296, August.
    17. Liu, Crocker H. & Rosenthal, Stuart S. & Strange, William C., 2018. "The vertical city: Rent gradients, spatial structure, and agglomeration economies," Journal of Urban Economics, Elsevier, vol. 106(C), pages 101-122.
    18. Ahlfeldt, Gabriel M. & Barr, Jason, 2022. "Viewing urban spatial history from tall buildings," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    19. Jason Barr & Jennifer Johnson, 2020. "Skyscrapers and the Happiness of Cities," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 46(2), pages 344-377, April.
    20. Ahlfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2019. "The economic effects of density: A synthesis," Journal of Urban Economics, Elsevier, vol. 111(C), pages 93-107.
    21. Lin, Jinyao & Lu, Siyan & He, Xiaoyu & Wang, Fang, 2021. "Analyzing the impact of three-dimensional building structure on CO2 emissions based on random forest regression," Energy, Elsevier, vol. 236(C).
    22. Hans R. A. Koster & Jos Ommeren & Piet Rietveld, 2014. "Agglomeration Economies and Productivity: A Structural Estimation Approach Using Commercial Rents," Economica, London School of Economics and Political Science, vol. 81(321), pages 63-85, January.
    23. Jason Barr & Bruce Mizrach & Kusum Mundra, 2015. "Skyscraper height and the business cycle: separating myth from reality," Applied Economics, Taylor & Francis Journals, vol. 47(2), pages 148-160, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. OTAZAWA Toshimori & OHIRA Yuki & Jos VAN OMMEREN, 2018. "Inter-firm Transaction Networks and Location in a City," Discussion papers 18054, Research Institute of Economy, Trade and Industry (RIETI).
    2. Ahlfeldt, Gabriel M. & Barr, Jason, 2022. "The economics of skyscrapers: A synthesis," Journal of Urban Economics, Elsevier, vol. 129(C).
    3. Hans R. A. Koster & Piet Rietveld & Jos N. van Ommerren, 2011. "Is the Sky the Limit? An Analysis of High-Rise Office Buildings," SERC Discussion Papers 0086, Centre for Economic Performance, LSE.
    4. María Ayuda & Fernando Collantes & Vicente Pinilla, 2010. "From locational fundamentals to increasing returns: the spatial concentration of population in Spain, 1787–2000," Journal of Geographical Systems, Springer, vol. 12(1), pages 25-50, March.
    5. Guy Michaels, 2011. "The Long Term Consequences of Resource‐Based Specialisation," Economic Journal, Royal Economic Society, vol. 121(551), pages 31-57, March.
    6. Duranton, Gilles & Jayet, Hubert, 2011. "Is the division of labour limited by the extent of the market? Evidence from French cities," Journal of Urban Economics, Elsevier, vol. 69(1), pages 56-71, January.
    7. Emmanuel Dechenaux & Dan Kovenock & Roman Sheremeta, 2015. "A survey of experimental research on contests, all-pay auctions and tournaments," Experimental Economics, Springer;Economic Science Association, vol. 18(4), pages 609-669, December.
    8. BERTINELLI, Luisito & STROBL, Eric, 2003. "Urbanization, urban concentration and economic growth in developing countries," LIDAM Discussion Papers CORE 2003076, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    9. Suzanne Kok, 2014. "Matching worker skills to job tasks in the Netherlands: sorting into cities for better careers," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-36, December.
    10. Stephen J. Redding, 2010. "The Empirics Of New Economic Geography," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 297-311, February.
    11. Carlino, Gerald & Kerr, William R., 2015. "Agglomeration and Innovation," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 349-404, Elsevier.
    12. Giulia Faggio & Olmo Silva & William C Strange, 0. "Tales of the city: what do agglomeration cases tell us about agglomeration in general?," Journal of Economic Geography, Oxford University Press, vol. 20(5), pages 1117-1143.
    13. Franke, Jörg & Leininger, Wolfgang & Wasser, Cédric, 2018. "Optimal favoritism in all-pay auctions and lottery contests," European Economic Review, Elsevier, vol. 104(C), pages 22-37.
    14. Li, Jiewei & Lu, Ming & Lu, Tianyi, 2022. "Constructing compact cities: How urban regeneration can enhance growth and relieve congestion," Economic Modelling, Elsevier, vol. 113(C).
    15. Lu, Jiangyong & Tao, Zhigang, 2009. "Trends and determinants of China's industrial agglomeration," Journal of Urban Economics, Elsevier, vol. 65(2), pages 167-180, March.
    16. Daisuke Oyama & Yasuhiro Sato & Takatoshi Tabuchi & Jacques-François Thisse, 2009. "On the impact of trade on industrial structures: The role of entry cost heterogeneity," Working Papers halshs-00566786, HAL.
    17. Gabriel M. Ahlfeldt & Stephen J. Redding & Daniel M. Sturm & Nikolaus Wolf, 2015. "The Economics of Density: Evidence From the Berlin Wall," Econometrica, Econometric Society, vol. 83, pages 2127-2189, November.
    18. Segev, Ella & Sela, Aner, 2012. "Multi-Stage Sequential All-Pay Auctions," CEPR Discussion Papers 8949, C.E.P.R. Discussion Papers.
    19. Gil Epstein & Ira Gang, 2007. "Who Is The Enemy?," Defence and Peace Economics, Taylor & Francis Journals, vol. 18(6), pages 469-484.
    20. Federico Curci, 2015. "The taller the better? Agglomeration determinants and urban structure," ERSA conference papers ersa15p991, European Regional Science Association.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:juecon:v:64:y:2008:i:1:p:49-64. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: http://www.elsevier.com/locate/inca/622905 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622905 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.