April 21, 2013

Debt May Not be as Bad as Once Thought: Rogoff and Reinhart Paper Disputed

From The Telegraph:

Row erupts over study into public debt as economists turn on Rogoff and Reinhart

A paper by two leading economists that was used by George Osborne to justify austerity measures in Britain contains "serious errors", rivals have claimed.

Growth in a Time of Austerity, by Harvard University profesors Ken Rogoff and Carmen Reinhart, has been called into question amid claims that it overstates the threat posed to economic growth by the level of government debt.
“Coding errors, selective exclusion of available data and unconventional weighting of summary statistics lead to serious errors,” according to a seperate paper by economists at the University of Massachusetts.