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Unexpected Connections: 10 Oddest Economic Indicators

        Money | Economic Concepts

7
Hemlines
Since skirts of all different lengths are popular right now, does that indicate the economy is schizophrenic? Anna Webber/Getty Images for Benefit Cosmetics
Since skirts of all different lengths are popular right now, does that indicate the economy is schizophrenic? Anna Webber/Getty Images for Benefit Cosmetics

Some economic indicators are so much fun, it hardly matters if they're actually true. Exhibit A is the "hemline theory" promoted by economist George Taylor back in the Roaring '20s. The Wharton School of Business professor couldn't help but notice the shockingly short dresses worn by flappers during the flush years before the stock market crash of 1929. According to Taylor's theory, women raised their skirts in good times to show off their expensive silk stockings. When they couldn't afford new stockings, the hemlines fell down [source: Carney].

Does that mean that a trend toward shorter or longer skirts can accurately predict movements in the stock market? Hardly. A team of economic researchers from the Netherlands compared hemline lengths with economic indicators from 1921 to 2009 and found that skirt lengths actually trailed the market by three to four years. In other words, skirts rose three years after an economic turnaround [source: Carney].

Clothing buyers for major retailers point out fashion trends work independently of the economy, although women are more likely to splurge on a name-brand skirt — long or short — when economic confidence is high, and opt for the discount version when money is tight [source: Sincere].


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