In this paper we ask what happens in the medium-term interregnum between the domain of the short run Phillips curve and that of the long run Phillips curve. In this interregnum inflation is anticipated but has real effects on the natural rate of unemployment, according to Friedman's conjecture. We discuss the new classical and hysteresis alternatives to Friedman's conjecture, and some of the methodological issues involved in appraising the conjecture. A simple model, and some data, are employed in this task.
|Place of Publication||Glasgow|
|Publisher||University of Strathclyde|
|Number of pages||45|
|Publication status||Published - Sep 2018|
- short run Phillips curve
- long run Phillips curve