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- Title
The Phillips Curve as a Menu for Policy Choice.
- Authors
Rees, Albert
- Abstract
This article focuses on the application of the Phillips Curve wherein it offers the policy maker a menu of choices between employment and inflation. The policymaker chooses a position according to the weights he attaches to the evils of unemployment and inflation given the set of alternatives or trade-offs provided by the Phillips curve. Furthermore, the basic Phillips mechanism involves a rise in employment and a fall in unemployment whenever there is an unacceptably high level of unemployment because employers relax hiring standards and accept workers who would not previously have been employed. Moreover, several approaches were considered in addressing unemployment and impact of inflation. Finally, it is concluded that policy makers should not attempt to operate at a single point on the Phillips curve rather, they should permit fluctuations in unemployment with a band.
- Subjects
PHILLIPS curve; ECONOMICS; MATHEMATICAL models of inflation; MATHEMATICAL models of the effect of inflation of unemployment; ECONOMIC statistics; ECONOMETRICS
- Publication
Economica, 1970, Vol 37, Issue 147, p227
- ISSN
0013-0427
- Publication type
Article
- DOI
10.2307/2551971