CANBERRA – The brouhaha over Carmen Reinhart and Kenneth Rogoff’s article “Growth in a Time of Debt” may be the most conspicuous and incendiary scholarly controversy since 1974, when two earlier economists, Robert Fogel and Stanley Engerman, published a notorious book, Time on the Cross, defending the efficiency of American plantation slavery.
As with Time on the Cross, the Reinhart/Rogoff controversy, while ostensibly stemming from the authors’ statistical procedures, is actually rooted in the purposes to which others put their study.
Some of the results reported by Fogel and Engerman were used – not by the authors themselves, it should be noted – to challenge affirmative action and question the civil-rights movement. Similarly, some of the results reported by Reinhart and Rogoff have been used by politicians and others to justify fiscal austerity.
When the problems with the Reinhart/Rogoff analysis came to light, the critics were aghast. The authors had inadvertently omitted data, used a questionable weighting scheme, and employed an erroneous observation on GDP growth.