Rogoff study (Rogoff paper)

In 2010, two star economists, Carmen Reinhart and Kenneth Rogoff – the latter was chief economist of the International Monetary Fund – published an empirical study on the relationship between government debt and economic growth in twenty industrialized countries after World War II. They concluded that growth in countries with debt exceeding 90 percent of gross domestic product was roughly one percent lower than in countries with low debt. In a worldwide campaign in all media, the Rogoff study was presented as falsified in the spring of 2013 because the figures on which the study was allegedly based had been selected arbitrarily. – However, the study was neither empirically nor factually refuted. If public debt is overwhelmingly high, the state will have to levy higher taxes in the long run. – But this slows down the economy, – and less is invested. – In addition, the incentives to perform decrease with a high tax burden ratio. – This also reduces the supply of innovations; the number of patents granted in highly indebted countries is demonstrably low. – See spending ratio, public, bank bailout, reverse, deficit-debt adjustment, deficit ratio, fiscal policy, fiscal referendum, research ratio, budget deficit, budget ratios, Methuselah syndrome, sustainability, net creditor, debt, floating, debt brake, debt drug, debt-debt recipe, debt sustainability, welfare state trap, government debt, effects, government debt reduction, government debt pressure, stability and growth pact, sunset proviso, growth-debt fact, historical, sustainability of public finances, constitutional article one, payday basic rule.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
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