Can the high Heel Index Predict Economic Growth
Over the past few years, high-end fashion labels have been tapping into their male customer bases with high-end high heels. To better understand this trend, a research study from the Journal of Fashion Marketing and Management investigates whether high heels can predict economic growth.
Economic Growth in Countries
In particular, I investigate whether high heel indices can predict economic growth in countries across the world. These high heel indices were created by the designers of high heels, and they could predict economic growth better than many commonly used economic indicators. In other words, I find that high-end fashion designers may have been on to something when they started designing high heels for men in order to target a male consumer base.
High Heel Economic Growth Relationship
In order to examine this high heel-economic growth relationship, high heel indices were created to reflect the high high heels market share. The three high heel indices are high heel shoe sales (heel type), high heel shoe market (heel height), and high heels store penetration (heel coverage).
The first two components of each index refer to high heel share of total high heels, and the last component is the actual size of high heels market. Hence, if a country has a large high heel market share but a low high heel store penetration rate, it would show up as a false positive or type II error – meaning that there may be no relationship between economic growth and high heels despite the high heels market – whereas if a country has high heel shoes but low share, it would appear as a type I error or false negative.
How Economic Growth is Measured
Economic growth is measured by the change in per capita GDP. This study uses data from 1981 to 2009 for all countries with available data related to high heel indices, high heel market (heel type), high heels store penetration (heel coverage), and economic growth. The information was obtained from company reports, national statistics agencies, the World Bank, the International Monetary Fund, and other secondary sources.
First, using econometric techniques to determine systematic relationships between high heels indices and high heel markets, I find ahigh heel market share or heel type in a country is positively associated with economic growth. The second finding was that a higher high heels store penetration rate or high heels coverage was also positively related to economic growth.
GDP Growth On Average
On average, an increase of one unit in the three high heel indices was associated with an increase of 0.3 unit in per capita GDP growth on average, and this high heel-economic growth relationship was found to be statistically significant at the 1% level.
Further investigation revealed that high heels store penetration is better than economic indicators or high heels market value as a high heel predictor. I found that high heels store penetration is the only significant high heels index in explaining economic growth across countries, whereas market share or market value was not significantly related to economic growth after controlling for the effect of high heels store penetration rate.