Note to self: when your research will be used as the basis of national economic policy, it might be a good idea to have someone else take a look-see at your calculations before you click the “submit” button.
Thomas Herndon, a UMASS-Amherst graduate student in economics, is the lead author on a paper that critiques a very influential 2010 study on public debt that was conducted by two Harvard professors, Carmen Reinhart and Kenneth Rogoff. Their study contended that a high debt to GDP ratio (greater than 90%) would cause slow economic growth. This has been used as the basis for austerity measures in struggling economies.
Herndon’s efforts were the product of a term paper assignment, wherein he was directed to replicate an economic study. When he received the data from one of the author’s he noticed some irregularities in the spreadsheet.
Mike Konczal of the The Next New Deal Blog broke the story (located here). Needless to say, there has been quite the hullabaloo surrounding Herndon. Overnight, Herndon has become quite the rock star. He appeared on the Colbert Report– which is about as much recognition that a econ grad student could hope for.