 Wikipedia |
Answer: it wasn't a peer-reviewed journal — or at least, the edition their work appeared in wasn't.
If you're new to this story, economic professors Carmen Reinhart and
They argued that high debt levels lead to low growth for countries, and at 90 percent debt levels, growth goes negative.
Everyone wrote this up at the time, and the study has been repeatedly cited by many deficit hawks.
But many had misgivings about their findings, because lots of people had trouble re-creating them using the data Reinhart and Rogoff cited. (There was also a lot of skepticism about whether the relationship between high debt and low growth was causal)
This week, a group of UMass economists published a paper saying they think they figured out, in part, why: the pair made an error in Excel that caused an entire subset of countries to be excluded from their data set. Finance blogger Mike Konczal was among the first to notice the new paper.
By Wednesday, Reinhart and Rogoff had fully owned up to the Excel oversight.
Still, many are wondering how could it have gone unnoticed by the Review.
We spoke with Virginia economics professor William R. Johnson, who edited the edition of the Review in which the paper first appeared.
This annual edition, "Papers and Proceedings," differs from all others in that the papers come out of presentations made at the yearly meeting of the American Economic Association, he said.
The papers are personally selected by the AEA's president-elect, in consultation with a committee.
As a result of these unusual circumstances, Johnson said, the editing of "Proceeding" papers is less rigorous.
"Normal peer review doesn't happen for these papers in the way of other issues of the AER."
Here, is what he's talking about. From the introductory section of the edition:
 AER |
The data must still be replicable.
But author prestige also comes into play, Johnson said, adding that that was true for all AER papers, not just the ones that appear in "Proceedings."
And it's not necessarily the referees' responsibility to replicate the findings.
"A lot of this is based on trust and people's reputations. The main mechanism for finding an error is after publication — someone tries to replicate it."
It's possible that if the paper had gone through the normal refereeing process it would have been caught, Johnson said, but he's not confident.
"If it's some internal data error, that's very hard to detected without replication," he said.
Reinhart and Rogoff are standing by their conclusions, despite the error.
But Arindrajit Dube (via Felix Salmon) has now made a convincing case that Reinhart and Rogoff have their causality reversed: rather than large debt driving slow growth, slow growth leads to large debts.
This is probably not over.