Reinhart and Rogoff #61,346: Stevenson and Wolfers Edition

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Sunday, 28 April 2013 21:46

Betsey Stevenson and Justin Wolfers are offering their assistance as referees in the debate over the Reinhart and Rogoff (R&R) spreadsheet error. They tell us:

"It has been disappointing to watch those on the left seize on the embarrassing Excel errors but ignore this bigger picture."

Of course the real story is that people on the left have seized on the embarrassing Excel error to bring about a public debate on an incredibly important debate from which they had previously been excluded. Just to remind everyone, R&R is being used as a rationale for cutting Social Security and Medicare as well as many other policies that are slowing growth and creating unemployment across much of the world. The corrected Reinhart and Rogoff spreadsheet does not come close to supporting the grand claims about the dangers of public debt they originally made, nor does it address the serious questions of causality that have followed in the wake of the discovery of their Excel error.

So we have two Harvard professors who used their status to push through work that was central to the most important economic policy debates in decades, based on analysis that was by their own admission incomplete. They also refused to make any of the data available until long after it was being widely cited in these debates. And, they routinely encouraged political figures to infer causality from debt to growth, when they were careful to deny any such claims when challenged by other economists.

And our two referees are disappointed by the conduct of those on the left.