Abstract A major contribution of Friedman’s 1968 presidential address was the long run vertical Phillips curve. This view has become so profoundly entrenched in macroeconomists’ way of thinking that evidence-based increasing acknowledgment of ‘hysteresis’, has not really discarded it. Although the notion of the NAIRU now prevails on that of the ‘natural’ unemployment rate, its macroeconomic features are the same as Friedman’s natural rate. Yet the path-dependence of empirically estimated NAIRUs causes an anomalous dissociation between theory and empirics. This should call for an alternative theoretical framework that might rehabilitate the original approach taken by Phillips vis à vis Friedman’s legacy.

A short story of the Phillips curve: from Phillips to Friedman...and back?

Walter Paternesi Meloni
2018

Abstract

Abstract A major contribution of Friedman’s 1968 presidential address was the long run vertical Phillips curve. This view has become so profoundly entrenched in macroeconomists’ way of thinking that evidence-based increasing acknowledgment of ‘hysteresis’, has not really discarded it. Although the notion of the NAIRU now prevails on that of the ‘natural’ unemployment rate, its macroeconomic features are the same as Friedman’s natural rate. Yet the path-dependence of empirically estimated NAIRUs causes an anomalous dissociation between theory and empirics. This should call for an alternative theoretical framework that might rehabilitate the original approach taken by Phillips vis à vis Friedman’s legacy.
File allegati a questo prodotto
File Dimensione Formato  
PaternesiMeloni_A-short_2018.pdf

solo gestori archivio

Note: Articolo
Tipologia: Versione editoriale (versione pubblicata con il layout dell'editore)
Licenza: Tutti i diritti riservati (All rights reserved)
Dimensione 373.93 kB
Formato Adobe PDF
373.93 kB Adobe PDF   Visualizza/Apri   Richiedi una copia

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11573/1657596
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 15
  • ???jsp.display-item.citation.isi??? 10
social impact