Difference between revisions of "Phillips curve"
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| − | In [[economics]], the '''Phillips curve''' is a graphical representation of the idea that there exists an inverse relationship between [[inflation]] and [[unemployment]]. In a standard Phillips curve diagram, the inflation rate or price level is plotted on the vertical axis, and the rate of unemployment on the horizontal. | + | In [[economics]], the '''Phillips curve''' is a graphical representation of the idea that "wages tend to rise faster when [[unemployment]] is low." <ref>[http://www.britannica.com/EBchecked/topic/456596/Phillips-curve Encyclopedia Britannica] |
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| + | there exists an inverse relationship between [[inflation]] and [[unemployment]]. In a standard Phillips curve diagram, the inflation rate or price level is plotted on the vertical axis, and the rate of unemployment on the horizontal. | ||
[[File:NAIRU.png|right|280px]] | [[File:NAIRU.png|right|280px]] | ||
Revision as of 15:46, June 6, 2009
In economics, the Phillips curve is a graphical representation of the idea that "wages tend to rise faster when unemployment is low." [1]
there exists an inverse relationship between inflation and unemployment. In a standard Phillips curve diagram, the inflation rate or price level is plotted on the vertical axis, and the rate of unemployment on the horizontal.
