Aggregation of lag patterns with an application in the construction industry

Abstract

This paper describes how the aggregate lag profile between the construction of dwellings and housing starts arises from the lag patterns of individual construction projects and the size distribution of projects. An empirical analysis of some 250 construction projects gives a description of (a) the lag patterns of individual projects, (b) the first moment density of the size distribution of projects, and (c) the impact of the size of the project on the value of the parameters of the individual lag pattern. A formula composed of these micro-elements appears to provide a satisfactory description of the aggregated lag pattern.