ECON 202 Lecture Notes - Lecture 11: Longrun, Nominal Rigidity, Edmund Phelps
7 Jul 2016
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Chapter 11: aggregate supply and the phillips curve. The phillips curve shows the negative relationship between unemployment and inflation: named after the new zealand economist a. w. Phillips for his empirical paper (1958) on the relationship between unemployment and wage growth in the united. The phillips curve seemed to fit the data in the 1960s very well. Inflation and unemployment in the united states, 1950-1969. Inflation and unemployment in the united states, 1970-2013. Source: economic report of the president. www. gpoaccess. gov/eop: from the late 1960s through the 1970s, however, inflation accelerated while the unemployment rate remained high. U u n e inflation e expected inflation. U natural rate of une unemployment sensitivity of to. Conclusions of the friedman-phelps phillips curve analysis: there is no long-run tradeoff between unemployment and inflation, there is a short-run tradeoff between unemployment and inflation, there are two types of phillips curves, long-run and short-run.
