Summary of the phillips curves, Macroeconomics

Assignment Help:

Summary of the Phillips curves

In neo-classical synthesis, augmented Phillips curve is known as the short-run Phillips curve. It is presumed to be stable as long as expectations of future inflation don't change. To summarize, we have three Phillips curves: 

 

  • Traditional Phillips curve. ΠW = f(U) and same downward sloping relationship applies to both the short and the long run.
  • Short-run Phillips curve (SPC). Πw = f(U) + Πe and curve is valid only in the short run (SPC = Short-run Phillips Curve).
  • Long-run Phillips curve (LPC). Πw = ΠM, U = UN and there is not any relationship between Πw and U (UN is natural rate of unemployment).

Related Discussions:- Summary of the phillips curves

Secondary effects in addition to the direct effect, Subsidy programs are li...

Subsidy programs are likely to have a number of secondary effects in addition to the direct effect on dairy prices. What impact do you suppose farm subsidies are likely to have on

Permanent income, assuming that B=0.33 Y1998=[0.33]Y1998 Estimate the perma...

assuming that B=0.33 Y1998=[0.33]Y1998 Estimate the permanent income for 1998

Various types of sports clothing, ABC Sports, a store that sells various ty...

ABC Sports, a store that sells various types of sports clothing and other sports items, is planning to introduce a new design of Arizona Diamondbacks' baseball caps. A consultant h

what is gdp in this economy, I. Consider the following static optimization...

I. Consider the following static optimization problem. Suppose that a consumer has financial wealth W and owns the house H¯ . She has utility over housing H and nonhousing co

Monopolistic competition, In monopolistic competition: a) Firms face a p...

In monopolistic competition: a) Firms face a perfectly elastic demand curve b) All products are homogeneous c) Firms make normal profits in the long run d) There are ba

BANK, HOW CAN CENTRAL BANK INFLUENCE THE STABILITY OF THE BANKING SYSTEM?

HOW CAN CENTRAL BANK INFLUENCE THE STABILITY OF THE BANKING SYSTEM?

Money, nature, development and function of money.

nature, development and function of money.

Define the monopoly of central banks, Define the monopoly of Central banks ...

Define the monopoly of Central banks The central bank has a monopoly on issuing currency, it is in complete control of the monetary base. In section 7.4.2 we will describe exac

Explain why interest rates are pro-cyclical, Critically explain why interes...

Critically explain why interest rates are pro-cyclical, using the supply and demand for bonds framework.

Porter''s model affect, How do the five competitive forces in Porter's mode...

How do the five competitive forces in Porter's model affect the profitability of the overall industry? For example, in what way might weak forces increase industry profits, and in

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd