in an opinion column on Wall Street diary, Princeton University economist Alan Blinder asks, Is the Phillips
Question:
in an opinion column on Wall Street
diary,
Princeton University economist Alan Blinder asks, "Is the Phillips curve dead?"
Source: Alan S. Blinder, "Is the Phillips Curve Dead? And Other Questions for the Federal Reserve", Wall Street
diary,
May 3, 2018.
to. Why have some economists and policymakers wondered in recent years whether the short-run Phillips curve trade-off between unemployment and inflation will no longer hold?
b. Briefly summarize how economists explain what has happened to the short-run trade-off between unemployment and inflation.
Some economists maintain that the
employment-population
the ratio has been trending
▼
lower
higher
for the last 20 years.
As a result, there may be
▼
further
No
any less
idle capacity in the labor market for a given unemployment rate than in previous years.
If he
employment-population
relationship returns to previous levels, the short-term relationship between inflation and unemployment may begin to look
▼
further
any less
like a typical Phillips curve.