Conventional wisdom holds that, in the long run, the Phillips curve is vertical. We re-examine the relationship between inflation and unemployment in the long run, using quarterly US data from 1952 to 2010, and state-of-the art econometric methods. Using a band-pass filter approach, we find...

The random walk hypothesis of consumption is tested after accounting for time aggregation bias. Lags on income and lags on a measure of wealth do not enter the regression significantly. Also, additional lags on consumption are not significant. No ARCH effects are present in the consumption...