Does High Public Debt Consistently Stifle Economic
Growth? A Critique of Reinhart and Rogoff
Thomas Herndon∗
Michael Ash
Robert Pollin
April 15, 2013
JEL codes: E60, E62, E65
Abstract
We replicate Reinhart and Rogoff (2010a and 2010b) and find that coding errors,
selective exclusion of available data, and unconventional weighting of summary statistics
lead to serious errors that inaccurately represent the relationship between public debt
and GDP growth among 20 advanced economies in the post-war period. Our finding is
that when properly calculated, the average real GDP growth rate for countries carrying
a public-debt-to-GDP ratio of over 90 percent is actually 2.2 percent, not −0.1 percent
as published in Reinhart and Rogoff. That is, contrary to RR, average GDP growth
at public debt/GDP ratios over 90 percent is not dramatically different than when
debt/GDP ratios are lower.
We also show how the relationship between public debt and GDP growth varies
significantly by time period and country. Overall, the evidence we review contradicts
Reinhart and Rogoff’s claim to have identified an important stylized fact, that public
debt loads greater than 90 percent of GDP consistently reduce GDP growth.
1 Introduction
In “Growth in Time of Debt,” Reinhart and Rogoff (hereafter RR 2010a and 2010b) propose
a set of “stylized facts” concerning the relationship between public debt and GDP growth.
RR’s “main result is that whereas the link between growth and debt seems relatively weak
∗Ash is corresponding author, mash@econs.umass.edu. Affiliations at University of Massachusetts Amherst:
Herndon, Department of Economics; Ash, Department of Economics and Center for Public Policy and
Administration; and Pollin, Department of Economics and Political Economy Research Institute. We thank
Arindrajit Dube and Stephen A. Marglin for valuable comments.
1
at ‘normal’ debt levels, median growth rates for countries with public debt over roughly 90
percent of GDP are about one percent lower than otherwise; (mean) growth rates are several
p