This was really funny: since a couple of days the economists community is unsettled. It has been found that one of the most influential economic article of the latest years – more than 2000 quotes – was wrong.
In 2010, Kenneth Rogoff and Carmen Reinhart of Harvard present a paper that seems to give scientific and indisputable bases to the Austerity policy [PDF]: they compare many countries – between year 1945 and 2009 – and discover that the ones with the economic numbers more in shape, i.e. with a debt below 30% of the GDP (Gross Domestic Product), have grown 4.1% on average.
The ones with a debt between 30% and 90% of GDP have grown only 2.8% on average.
The ones – like Italy – with a debt more than 90% of GDP had a negative growth: -0.1%
Political-economic conclusion: when the debt is too high, the interest rates payments bring the country in recession. Therefore, to reduce the public debt using cuts and taxes is necessary in order to grow again.
Now, three years later, two professors of Amherst University in Massachusetts, Robert Pollin and Michael Ash, assign to one of their student, Thomas Herndon, a classic exercise (maybe not so practiced in economic studies): to take the data used by some famous research and repeat the calculus (something that an academic journal should do before publishing a paper, but often they don’t).
The result: the calculations by Rogoff and Reinhart were wrong [PDF], probably because of a bug in an Excel spreadsheet !