New Zealand's disproportionate influence on world affairs has been highlighted once more as a dodgy data point sparked renewed hostilities in the austerity wars.
The controversy, and New Zealand's glorious role in it, were revealed last week after an American student, Thomas Herndon, unearthed Excel-related statistical flaws in a previously-revered 2010 study by legendary economists Carmen Reinhart and Kenneth Rogoff.
In their influential 2010 study Reinhart and Rogoff allegedly showed a strong causal link between low-growth and government debt. As soon as a country's government debt hit 90 per cent of GDP, the Reinhart and Rogoff data showed economic disaster would ensue.
However, as the Herndon data redo showed, the original paper included a number of errors that undermined the findings particularly the 90 per cent debt-to-disaster threshold.
As well as dropping out five of the 20 countries used in the historical sample, "... Reinhart and Rogoff used only one year of data for New Zealand, 1951, when growth was minus 7.6 per cent, significantly skewing the results", the Financial Post reported.