Copyright © 2004 South-Western
3535The Short-Run Tradeoff between Inflation and
Unemployment Valið milli verðbólgu og
atvinnuleysis
Copyright © 2004 South-Western
THE PHILLIPS CURVE
• The Phillips curve illustrates the short-run relationship between inflation and unemployment. Phillips kúrfan sýnir skammtíma samband verðbólgu og atvinnuleysis. Atvinnuleysi minnkar þegar verðbólga eykst og öfugt - þ.e. þegar samdráttur er í efnahagslífinu og verðbólga minnkar, þá eykst atvinnuleysi.
Figure 1 The Phillips Curve
UnemploymentRate (percent)
0
InflationRate
(percentper year)
Phillips curve
4
B6
7
A2
Copyright © 2004 South-Western
Copyright © 2004 South-Western
The Long-Run Phillips Curve
• In the 1960s, Friedman and Phelps concluded that inflation and unemployment are unrelated in the long run. Til lengri tíma eru engin tengsl milli verðbólgju og atvinnuleysis.• As a result, the long-run Phillips curve is vertical at
the natural rate of unemployment.
Figure 3 The Long-Run Phillips Curve
UnemploymentRate
0 Natural rate ofunemployment
InflationRate Long-run
Phillips curve
BHighinflation
Lowinflation
A
2. . . . but unemploymentremains at its natural ratein the long run.
1. When the Fed increases the growth rate of the money supply, the rate of inflation increases . . .
Copyright © 2004 South-Western
Figure 5 How Expected Inflation Shifts the Short-Run Phillips Curve
UnemploymentRate
0 Natural rate ofunemployment
InflationRate Long-run
Phillips curve
Short-run Phillips curvewith high expected
inflation
Short-run Phillips curvewith low expected
inflation
1. Expansionary policy movesthe economy up along the short-run Phillips curve . . .
2. . . . but in the long run, expectedinflation rises, and the short-run Phillips curve shifts to the right.
CB
A
Copyright © 2004 South-Western
Top Related