Four times they call it a "coding error"

From WSJ: Reinhart, Rogoff Admit Excel Mistake:

Herndon, Ash and Pollin accurately point out the coding error that omits several countries from the averages in figure 2.

If you're not so hot with Excel, I guess you could call it a "coding" error. It's a goddam click-and-drag mistake, that's all it is. An embarrassingly amateurish mistake.

Here's the thing: When they selected the values for a list of 20 countries, they missed the last five values. Konczal has a screen clip:
New link for the Konczal post, 25 April 2018

See the dark blue rectangle with a dot in each corner? Column L, rows 30 to 44. That's a "range" of cells that somebody used in a calculation.

What calculation? Lower right corner, Cell L51, the calculation begins with an equal sign and takes the average value of the cells in the dark blue box.

The blue box should have gone all the way down to row 49. If it did, it would have included one more actual value. Would it have made much difference? I don't know. But the cell-selection would have been right, at least.

If I made a mistake like that in a spreadsheet at work, the boss would somehow figure it out right away and I'd get reamed for it, fairly. And then we would go back to work. So should y'all now.


Having gone back to work myself, the focus of this post changes.

Last December, in Simulacron: Make that three trends I showed this graph of inflation-adjusted GDP with three different trend paths:

Graph #1: Stages of the slowdown in real growth

I wrote:

By the fourth quarter of 2007 when real GDP reached 13.3 trillion, blue trend GDP was 17 trillion, more than 25% greater.

Twenty-five percent.

In the "R&R Admit" post linked at the top, Reinhart and Rogoff write:

It is utterly misleading to speak of a 1% growth differential that lasts 10-25 years as small. If a country grows at 1% below trend for 23 years, output will be roughly 25% below trend at the end of the period, with massive cumulative effects.

Twenty-five percent. Reinhart and Rogoff got this one right, guys.

Give 'em a break.

// 10:54 pm Update:

Come to think of it, the Gross Federal Debt fell from over 90% of GDP in the late 1940s to just over 30% in 1974, skidded along the bottom until 1981, and then started going up:

Graph #2: Gross Federal Debt as a Percent of GDP

According to Graph #1, the economy grew with vigor until the Federal Debt reached a low point. And then, with Federal debt at a low, the economy lost its vigor. And for the three decades since the early 1980s the economy grew about 1% slower than in the three decades before the early 1980s.

So according to these two graphs, one could say it was the lowness of the Federal debt that caused the slowdown in economic growth.

And as Reinhart and Rogaine point out, a long period of 1% slower growth has "massive cumulative effects".

What everybody seems to miss in all of this, is that when the Federal debt was high in the early years of Graph #2, private debt was at a low point. Today the Federal debt is high again, and private debt is also at a high point.

In the early years, accumulated private debt did not interfere with private sector growth. Today it does.