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... "Maddison's estimates seem to be full of such indirect estimates, or simple assumptions. He seems to have a passion for believing figures once they are written down, no matter how they were estimated, and often prefers his own estimates or those of others without much explanation or justification. However, national income estimates are 'fragile'. Difficulties discussed by estimators include: the impossibility of identifying and measuring realistically the output of service industries; the lack of a framework for estimates before the 20th century as provided, for example, by population estimates needed to ensure consistency; and limitations of price series due to inadequate price data and index number problems (Wilson, 1946); (Deane and Cole, 1962; p. 4).
On Australian estimates, Maddison is apparently dissatisfied with Butlin's estimates (Butlin, 1962), as well as my own, and has constructed a new series by joining the two estimates at 1910 for some unknown reason. Perhaps the intention is to have a bet each way. He makes no attempt to reconcile the estimates (which are not congruent), so his series can best be described as a hotch potch of inconstant estimates ...
Maddison does not explain why he prefers my series to Butlin's before 1910, and Butlin's after 1910, apart from a reference to problems of estimation that are common to both series ... Maddison ignores, or is unaware of, the extensive criticism of Butlin's figures, by national accountants and economic historians, published in various Australian and overseas journals. Reference to other estimates described in Studenski (1958) shows Butlin's estimates to be probably the most criticized series in the history of national accounting, and probably the most unreliable.
Maddison is also careless with references. He states, for example, that 'Butlin did not take his price indexes from the shelf', whereas Butlin (1962; p. 454) stated that he had used 'available price series'. He believes the industrial prices given by Sheregold in his chapter on 'Prices and Consumption' in Vamplew (1987) complement Butlin's price series, but they are, in fact, identical. He considers McLean to have added to available prices for deflating value added, but McLean's paper deals only with retail prices, considered by Butlin as irrelevant for the purpose. On my estimates, he states that I rejected Butlin's estimates en bloc and made two specific criticisms. In fact I did not criticize Butlin's overall results, but simply commented that 'My estimates are put forward as an alternative series', 'they also have limitations, and for this reason they are checked against the historical record'. Nor did I make the criticisms Maddison contends I made ...
Finally, a reference should be made to the work of Sir Timothy Coghlan, the real pioneer of historical estimates, who compiled historical series of real income for New South Wales from the early 1820s to 1900. Coghlan considered the only true measure of real income was real wages, and he rejected the use of real product, because the series did not reflect the effect of overseas events on domestic income, including capital inflow and changes in the terms of trade. Roland Wilson in the 1940s (in the earlier cited reference) also rejected the use of real GDP in preference to series of real wages. Stiglitz has recently pointed out that real wages, another and possibly better measure of material welfare, declined over the post 10 years in the USA, and this despite an increase in real GDP per capita of some 1.9 per cent a year from 1991-2002. Maddison's results (based on Butlin's figures) are completely different to Coghlan's series, and by the standards of Australian official statisticians, they are inaccurate and irrelevant as a measure of Australian real income in the 19th century."
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