Honesty With Data
25 January 2007
Editor, The New York Review of Books
To the Editor:
Paul Krugman alleges that, when "speaking to the mass public," Milton Friedman was intellectually dishonest ("Who Was Milton Friedman?" Feb. 15).
Well now. As EconLog's Arnold Kling points out, Mr. Krugman himself - in his essay on Friedman - commits what some might classify as intellectual dishonesty. Krugman correctly notes that Americans during the years 1947-1976 more eagerly embraced government regulation than they did during the years 1977-2005. Then Krugman (also correctly) notes that real family income grew more rapidly during the earlier period than during the latter - suggesting that ordinary Americans were hurt by the slowdown in the growth of government.
But as Krugman surely knows, family size has shrunk: it is nearly 19 percent lower today than it was in 1970. So the decline in family income might reflect nothing more than the shrinkage in the size of families. The more honest measure of economic well-being is real GDP per capita. And as Kling points out, this figure "grew at about the same rate over [both periods]. Using 1946, 1976, and 2005 as endpoints, the average annual growth rate was 1.021 in the first half and 1.020 in the second half."
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Editor, The New York Review of Books
To the Editor:
Paul Krugman alleges that, when "speaking to the mass public," Milton Friedman was intellectually dishonest ("Who Was Milton Friedman?" Feb. 15).
Well now. As EconLog's Arnold Kling points out, Mr. Krugman himself - in his essay on Friedman - commits what some might classify as intellectual dishonesty. Krugman correctly notes that Americans during the years 1947-1976 more eagerly embraced government regulation than they did during the years 1977-2005. Then Krugman (also correctly) notes that real family income grew more rapidly during the earlier period than during the latter - suggesting that ordinary Americans were hurt by the slowdown in the growth of government.
But as Krugman surely knows, family size has shrunk: it is nearly 19 percent lower today than it was in 1970. So the decline in family income might reflect nothing more than the shrinkage in the size of families. The more honest measure of economic well-being is real GDP per capita. And as Kling points out, this figure "grew at about the same rate over [both periods]. Using 1946, 1976, and 2005 as endpoints, the average annual growth rate was 1.021 in the first half and 1.020 in the second half."
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Posted by Don Boudreaux on
Tuesday October 9, 2007 at 6:24am