Economists have two standard explanations for the absence of substantial nominal wage pressures in the current macroeconomic climate. The first, and more traditional, view asserts that the NAIRU has drifted downward over the last decade, while the second posits the establishment of a "new...

This essay shows that the stable Phillips curve cannot be mapped off an aggregate supply curve that is linear or exponential. Yet many principles of economics books claim that the stable Phillips curve is a mapping of a stable aggregate supply curve. Treating the stable Phillips curve...

In this paper I compare Friedman's expectations-augmented Phillips Curve model with Lucas' model on expectations and the neutrality of money and claim that they are underpinned by two different equilibrium concepts. Friedman's model is based on the stationary equilibrium conception, typical of...