Global Economic Prospects 2015

The global economy is still struggling to gain momentum. Read more ...

Development Prospects

Providing information, analysis, and advice on global trends in the world economy.  Find out more ...

Global Economic Monitor

Now free. Daily and monthly updates on global economic developments and relevant topical issues. Find out more ...

Syndicate content

Add new comment

Submitted by Jamus Lim on
I agree with your comment that overlapping error bars generated from confidence intervals do not, in and of themselves, necessarily imply statistically insignificant differences. This is precisely why, in the postscript, I had provided the same figure with error bars generated from standard errors, of which overlap definitively indicates the absence of statistical significance. And as clarified in the postscript, there is no statistically significant difference in the 30/60 and 60/90 bins, and between the 60/90 and >90 bins, which can be formally verified with two-tailed t-tests (which for the record yield T = 0.83, p = 0.25 and 1.18, p = 0.25, respectively). This is the point of the post: that R-R have overstated their case of how >90 percent debt/GDP ratio actually represents some kind of (statistically significant) threshold (based on their data). Of course, there is always a tradeoff between clarity and ease of interpretation in conveying statistical results in the form of a graph, and I regret that I was not clearer in my original post.