Skip to main content

View Diary: NYT: It's Krugman Vs. Reinhart & Rogoff, Who Trivialize Their Incompetence And Attack “Left” (246 comments)

Comment Preferences

  •  As to that "Unconventional Weighting"... (5+ / 0-)

    ...R&R say this will be addressed "online only", not in their actual op-ed.

    How convenient.  Because, presumably

    "The plebeians won't understand such lofty matters anyway..."
    ... or something.

    Too bad there's another side to this debate, e.g. that pesky graduate student Thomas Herndon, who - again - has the nerve to think he can explain to the plebeians in lay terms, what "unconvetional weighting" means:

    “Unconventional” is appropriate in describing their averaging technique.  To use a baseball analogy, suppose we had a team with two players, and we want to find the team’s overall batting average. The first player has 100 at bats, is successful one-fifth of the time, and therefore has a .200 batting average. The second player has a single at bat, but gets on base in this one at-bat, and so has a perfect 1.000. If we use the Reinhart-Rogoff method, we would equally weight the .200 and 1.000 batting averages, and thus find that the team has an overall .600 batting average. If we used conventional methods of calculating the team’s batting average, it would more or less remain .200.

    The underlying problem is not that their method is necessarily wrong, but that it is particularly sensitive to outliers. This contributed to the “perfect storm” of errors whose combined effect caused the large decline in average GDP. If the only problem was the weighting, this would not have been sufficient to cause a drastic decline in average GDP growth.  However, it was the combination of the weighting system with the exclusion – for whatever reason – that combined to cause the most significant fall in average GDP growth. There is nothing inherently wrong with their weighting system. However it is unusual and it is their obligation to be open and clear in explaining why they used this unusual methodology.

    Indeed, Herndon is being very gracious and generous here.

    "Nothing inherently wrong" in R&R's weighting, except that it produces slanted and misleading results that just happen to fall in the direction their 1% benefactors prefer.

    In statistical terms, their weighting scheme biases the estimate. In public-debate terms, it is.... oh yeah, biased :)

Subscribe or Donate to support Daily Kos.

  • Recommended (122)
  • Community (60)
  • Media (23)
  • Elections (23)
  • Civil Rights (22)
  • Culture (21)
  • Law (21)
  • Environment (21)
  • Trans-Pacific Partnership (21)
  • Josh Duggar (20)
  • Science (19)
  • Labor (18)
  • Economy (17)
  • Marriage Equality (16)
  • Ireland (16)
  • 2016 (15)
  • Bernie Sanders (15)
  • Hillary Clinton (15)
  • Climate Change (15)
  • Health Care (14)
  • Click here for the mobile view of the site