In economics, the Phillips curve is a historical inverse relationship between the rate of unemployment and the rate of inflation in an economy. Stated simply, the lower the unemployment in an economy, the higher the rate of inflation. While it has been observed that there is a stable short run tradeoff between unemployment and inflation, this has not been observed in the long run.
Other articles related to "phillips curve, phillips":
... The concept arose in the wake of the popularity of the Phillips curve which summarized the observed negative correlation between the rate of unemployment and the rate of inflation (measured as annual nominal wage ... During the 1970s in the United States and several other industrialized countries, Phillips curve analysis became less popular, because inflation rose at the same time that unemployment rose (s ... Worse as far as many economists were concerned, the Phillips curve had little or no theoretical basis ...
... in inflation analysis is the relationship between inflation and unemployment, called the Phillips curve ... The Phillips curve model described the U.S ... macroeconomics describes inflation using a Phillips curve that shifts (so the trade-off between inflation and unemployment changes) because of such matters as supply shocks and ...
... of the natural rate of unemployment came in the 1960s where economists observed that the Phillips-curve relationship between inflation and unemployment began to break down ... According to Friedman and Phelps, the Phillips curve was therefore vertical in the long run, and expansive demand policies would only be a cause of inflation, not a cause of permanently lower unemployment ...
... Gordon of Northwestern University has analyzed the Phillips curve to produce what he calls the triangle model, in which the actual inflation rate is determined by the sum of demand pull or short-term Phillips curve ... Supply shocks and changes in built-in inflation are the main factors shifting the short-run Phillips Curve and changing the trade-off ... encourages high inflation, as with the simple Phillips curve ...
... the 20th century showed a negative correlation between inflation and unemployment called the Phillips curve ... an influential paper arguing that the failure of the Phillips curve in the 1970s was just one example of a general problem with empirical forecasting models ... In the context of the Phillips curve, this means that the relation between inflation and unemployment observed in an economy where inflation has usually been low in the past would differ from the relation ...
Famous quotes containing the words curve and/or phillips:
“The years-heired feature that can
In curve and voice and eye
Despise the human span
Of durancethat is I;
The eternal thing in man,
That heeds no call to die.”
—Thomas Hardy (18401928)
“Hollywood is a place that attracts people with massive holes in their souls.”
—Julia Phillips (b. 1945)