Economics Detective Radio

Today's guest is Stephen Smith, he is an analyst for a New York real estate firm. Stephen did some research showing that at least 40 percent of the buildings in Manhattan could not be built under today's zoning regulations. In fact, the number is probably significantly higher. Classic landmarks like the Empire State Building, with its floor-area ratio of 30, wouldn't fly today. Watch this time-lapse of the New York City skyline, and pay close attention to the kind of changes that happen in the earlier part of the video compared to the later part: Before the twentieth century, the pace of change is very gradual. Two storey buildings are replaced with three storey buildings. Waves of development sweep through the city, replacing wood buildings with brick and stone and concrete. In the twentieth century, we see a different kind of development. Pay attention to any particular small building and you'll notice one of two things happening: Either the building stays exactly as it is, or it is replaced by a massive s