Understanding Inflation and the Implications for Monetary Policy: A Phillips Curve Retrospective
Jeff Fuhrer is a Non-Resident Fellow at the Brookings Institution and a Foundation Fellow at the Eastern Bank Foundation. He was previously Executive Vice President and Director of Research at the Federal Reserve Bank of Boston, where he was also responsible for the bank's diversity and inclusion functions.
Yolanda Kodrzycki is an economist in the Research Department at the Federal Reserve Bank of Boston.
Jane Little is an economist in the Research Department at the Federal Reserve Bank of Boston.
Giovanni Olivei is an economist in the Research Department at the Federal Reserve Bank of Boston.
Current perspectives on the Phillips curve, a core macroeconomic concept that treats the relationship between inflation and unemployment.
In 1958, economist A. W. Phillips published an article describing what he observed to be the inverse relationship between inflation and unemployment; subsequently, the “Phillips curve” became a central concept in macroeconomic analysis and policymaking. But today's Phillips curve is not the same as the original one from fifty years ago; the economy, our understanding of price setting behavior, the determinants of inflation, and the role of monetary policy have evolved significantly since then. In this book, some of the top economists working today reexamine the theoretical and empirical validity of the Phillips curve in its more recent specifications. The contributors consider such questions as what economists have learned about price and wage setting and inflation expectations that would improve the way we use and formulate the Phillips curve, what the Phillips curve approach can teach us about inflation dynamics, and how these lessons can be applied to improving the conduct of monetary policy.
Contributors Lawrence Ball, Ben Bernanke, Oliver Blanchard, V. V. Chari, William T. Dickens, Stanley Fischer, Jeff Fuhrer, Jordi Gali, Michael T. Kiley, Robert G. King, Donald L. Kohn, Yolanda K. Kodrzycki, Jane Sneddon Little, Bartisz Mackowiak, N. Gregory Mankiw, Virgiliu Midrigan, Giovanni P. Olivei, Athanasios Orphanides, Adrian R. Pagan, Christopher A. Pissarides, Lucrezia Reichlin, Paul A. Samuelson, Christopher A. Sims, Frank R. Smets, Robert M. Solow, Jürgen Stark, James H. Stock, Lars E. O. Svensson, John B. Taylor, Mark W. Watson
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Table of Contents
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1: The Phillips Curve in Historical Context
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2: Fifty Years of the Phillips Curve: A Dialog on What We Have Learned
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3: Forecasting Inflation
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4: The Labor Market and the Phillips Curve
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5: Inflation Expectations
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6: Evidence on Price Determination
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7: Is the Phillips Curve Vertical in the Long Run?
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8: Lessons for Central Bankers: A Panel Discussion
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9: The Phillips Curve Going Forward: What We Still Need to Learn
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