The idea of the 'L-shaped aggregate supply curve', supposedly a feature of primitive macroeconomic models, is in fact a reasonable reconstruction of a well developed way of thinking that specifically denied a relation between wage change and aggregate employment.  Neither that approach nor the...

The 'expectations critique', usually attributed to Friedman or Phelps and dated towards the end of the 1960s, in fact originates much earlier.  And rather than being an insight properly attributable to a particular individual, it was, by that time, a commonplace of economic discussion.  This...

Friedman (1968) - his famous Presidential Address to the American Economic Association - contains an elementary error right at the heart of what is usually supposed to be the paper's crucial argument.  That is the argument to the effect that during an inflation, changing expectations shift in...

There is a widely believed but entirely mythical story to the effect that the discovery of 'the Phillips curve' was, in the 1960s and perhaps later, an inspiration to inflationist policy.  The point that this is a myth is argued in Forder, Macroeconomics and the Phillips curve myth, OUP 2014. ...

In his Nobel lecture, Friedman built on his earlier argument for a 'natural rate of unemployment' by painting a picture of an economics profession which, as a result of foolish mistakes, had accepted the Phillips curve as offering a lasting trade-off between inflation and unemployment and were...

In this paper we introduce a small Keynesian model of economic growth which is centered around two advanced types of Phillips curves, one for money wages and one for prices, both being augmented by perfect myopic foresight and supplemented by a measure of the medium-term inflationary climate...

A large literature in macroeconomics assumes a social objective function, W(pi,U), where inflation, pi, and unemployment, U, are bads. This paper provides some of the first formal evidence for such an approach. It issues data on the reported well-being levels of approximately one quarter of a...

This paper analyses a new-Keynesian model incorporating hysteresis in output. Specifically, we assume that the natural rate of output sluggishly adjusts towards current output. We also assume that the natural rate has an upper bound and that, in addition to having standard objectives, the...

Standard open economy models predict that openness to trade should exert a positive effect on the slope of the output-inflation tradeoff, or Phillips curve, but such a proposition finds very little support in the existing empirical literature. We propose a new test of this hypothesis based on...

A number of thoretical models predict that the slope of the Phillips curve increases with trade openness, but cross-country studies provide little evidence for such a correlation. We highlight two reasons for this finding. Firstly, the strength of the relationship may depend on the extent of...