Capital Switching and the Built Environment: United States, 1970–89

Abstract

In this paper, a ‘weak’ test of the capital-switching argument developed by David Harvey is offered. With data on construction investment activity for the USA and on various alternative investments, a temporal analysis was used to assess whether evidence exists for the movement of capital from the primary to the secondary circuit. The investigation is focused specifically on the building boom of the 1980s, as that expansion has been the focus of recent theoretical and empirical work centered on the relation between urbanization and the restructuring of capital. Little support was found for the claim that capital switching has occurred, but the data do point to a delinking of real-estate investment from nonspeculative investment criteria and use-value considerations.