John please correct the reference to Economic Papers – this rubbish would not be published there because I edit that.
Let’s have a look at ‘this rubbish’. The journal itself is ranked in here at 6th place amongst economics journals – that is probably on the high side – Economic papers is ranked 752. (It’s 33 on this list where Economic Papers isn’t listed at all). According to Harzing’s Publish or Perish the paper (Tales of fiscal adjustment) has been cited 387 times in the past 15 years. Alberto Alesina himself is ranked at 31 amongst academic economists. If Harry Clarke won’t publish that sort of stuff, maybe he should.
Update VI: Quiggin makes the argument that Economic Policy isn’t peer-reviewed in the normal sense because the journal doesn’t accept unsolicited papers.
I’ve always assumed that Economic Papers follows the standard practice in this respect, but Davidson is welcome to check it out, if he cares enough.
It is unusual for a journal to not accept unsolicited papers but that is a matter for the editors – here are their instructions to referees. Published papers have actually been through a peer-review process. Here are further instructions to the Editorial Panel.
I’ve just read ‘Tales of Fiscal Adjustment’ by Alesina and Ardagna, which appears to be the founding text for the idea of expansionary austerity.
That’s fine. But in the post that generated this exchange, he is talking about a different paper ‘Large changes in ?scal policy: taxes versus spending’ – that was the paper criticised by The Economist. The problem that still remains is this
But Alesina’s work is probably the most-refuted piece of economic analysis put out (though never published in a peer-reviewed journal) …
The Tales of Fiscal Adjustment paper was published in Economic Policy in 1998. As far as I’m aware that is a peer-reviewed journal.
Update III: Robert Carling emails his response.
We referred to Alesina’s work not because it is the only or last word on this topic, but because it is an example of a much larger literature in support of fiscal austerity. This literature has been drowned out in the media by people like Krugman. (Incidentally, I dislike the term ‘austerity’ in this context and only use it because it has become a popular label that conveys the substance behind it to more people than the more academic term ‘fiscal consolidation’, which I prefer.) We could also have cited the work of people like Barro and Taylor in support of our case, and theoretical arguments as well as the empirical evidence in which Alesina specialises. I am very well aware of what the IMF has said on this subject, and I could also quote from IMF publications over the years that have cast doubt on the efficacy of fiscal stimulus. I also know that just because the IMF says something doesn’t make it right. I also recognise nuances that we could not canvass in a 600 word newspaper article. One is that each country is unique and the arguments about fiscal consolidation have to be tweaked depending on country circumstances. Greece, for example, will suffer from fiscal consolidation, but that is partly the fault of the exchange rate straitjacket that they want to keep wearing, and their EU partners want them to keep wearing. What alternative does Greece have in the circumstances it is in? But in general I stand by our basic proposition that fiscal multipliers are much smaller than the advocates of stimulus and the opponents of consolidation seem to think.
Update II: John Quiggin responds here.
Update: Stephen Kirchner responds here.
Robert Carling and Stephen Kirchner had an op-ed in the AFR yesterday talking about ‘austerity’.
Harvard University economist Alberto Alesina and his co-authors have systematically studied every major episode of fiscal adjustment across the Organisation for Economic Co-operation and Development countries since 1980. They find that fiscal consolidations driven by reductions in government spending are as likely to be associated with high economic growth as fiscal expansions.
These findings are consistent with the estimates of economists such as Robert Barro and others that the multiplier effect from discretionary fiscal stimulus is small. These effects are symmetrical, implying that a fiscal consolidation need not have negative implications for economic growth.
That op-ed has generated a strange post from John Quiggin.
But Alesina’s work is probably the most-refuted piece of economic analysis put out (though never published in a peer-reviewed journal) in recent decades. It’s been demolished not only by the usual suspects like Krugman and DeLong (and me), but by the Economist, the IMF and even by one of Alesina’s own co-authors, Roberto Perotti.
So the paper in dispute is Large changes in ?scal policy: taxes versus spending (ungated earlier version here). Quiggin claims this paper was “never published in a peer-reviewed journal”. That is a strange claim to make. Alesina lists it on his “Recently Published Papers” web-page, while the NBER claims it was published in in “Tax Policy and the Economy, Volume 24 (2010), The University of Chicago Press”. Perhaps this (excellent) publication isn’t peer reviewed? So I had a look at the Jstor page for the journal.
Tax Policy and the Economy publishes current academic research findings on taxation and government spending that have both immediate bearing on policy debates and longer-term interest.
Edited by Jeffrey R. Brown and James M. Poterba.
That might be out of date – James Poterba no longer edits the journal. But you get the idea. It also lists the NBER Board of Directors – but what about peer-review? I found this under the instructions for authors before the paper is sent to the publishers (emphasis added).
Before a manuscript is transmitted to UCP, all negotiations between the journal office, peer reviewers, and authors with regard to its content, organization, etc. must have been resolved.
That would seem to suggest that there is a peer-review process.
I also downloaded a copy of the paper from the University Library system (for my own records anyway) and to ensure that both the Alesina and NBER were actually telling the truth. All up, as far as I can tell, the paper exists, the paper was published, and appears to have been peer-reviewed.
Then is it the most refuted piece of economic analysis in recent decades? Hard to tell – I google scholared the paper. Wow – 140 cites already; doing well for an unpublished, non-peer reviewed work. They can’t all be negative – the first is by Barro. Then what about being slagged by The Economist and
could they not have spent 30 seconds with Google before hitting “Send”? A search on Alesina+austerity reveals a torrent of criticism, none of which they mention.
Well I followed Quiggin’s advice and googled “Alesina+austerity”. The very first post is by Veronique de Rugy – likely to support the Alesina view.
Alesina himself responds to The Economist here.
The only fig-leaf that Quiggin has is
the work on which they relied was, at best, highly controversial.
Fancy that – cutting edge research into a highly politicised aspect of public policy is “controversial”. Does Quiggin think AFR readers are so dumb they wouldn’t realise that? Really?
So what are we to make of this?
It is hard to know which is worse – the possibility that Kirchner and Carling, presented by the CIS as expert economists, were ignorant of all this, or the alternative hypothesis that they knew it and decided not to mention it. Either way, it’s an appalling breach of elementary standards of research.
I’m pretty sure the facts have been brought to the attention of Kirchner and Carling. The honest thing to do would be to write to the Fin pointing out that the work on which they relied was, at best, highly controversial. If Kirchner, Carling and the CIS are unwilling to do this, we can draw the conclusion that they cannot be trusted in anything they write.
This is not an open invitation for people to launch into John Quiggin – excessively rude or OT comments will be culled.