Symbolism, Imagery, Allegory
The pagoda is a large structure in the town that's supposed to signify wealth and a bright future—which is the exact opposite of what it does. Oops. Instead, it's just a big old gaudy reminder of how the town hasn't lived up to its promises. But don't take our word for it, let the Pagoda tell you itself:
When I was built, I was supposed to be a top-of-the-line resort, but the owners never secured a liquor license, so I became an instant disappointment. A shame. I would never be a temple, or a resort, or a hotel. (2.7.1)
Sound familiar? This high-hopes-turned-disappointment identity can be seen throughout the book—in Charlie's inability to not act like his dad, in Vera's feelings about her friendship with Charlie as it deteriorates, in Ken's sobering up and going to school only to lose his wife. The Pagoda is a reminder of this theme.
The Pagoda witnesses the town as it grows… and as its socioeconomic problems rise. The Pagoda serves as a silent witness to the seedier side of things that happen in town; it observes the teenagers smoking and doing drugs around it, the pervert coming up and propositioning people for pictures/used underwear, and the overall decline of the town. In this sense, the Pagoda doesn't just represent lost dreams, it also serves as a reminder that life goes on anyway, no matter how terrible things might get.