ECON 1202 Lecture Notes - Lecture 29: Phillips Curve, Monetarism, Aggregate Demand
ECON 1202 verified notes
29/29View all
Document Summary
Note: when in ation is expected: people take it into account in terms of their contracts, results in new sr phillips curve with higher in ation expectations, our gov"t can reduce unemployment at higher risk of in ation. Keynes: complete wage and price rigid, instable investment = drives ad uctuations. Believe: monetary policy can be destabilizing, can create cyclicality. Friedman: a monastery history of the us, capitalism and freedom, in ation is a monetary phenomenon. Hayek and friedman: thought keynes had it backwards, only voices agains keynesianism, no such thing as a free lunch . Why collapse of ad: collapse of money and banking that caused decline in ad. Why we got out: not to do with scal policies, but increase in money supply. Real business cycle: uctuations in output not ad issues but as issues, shocks that cause deviations.
