relationship between inflation and unemployment is nonlinear. Using aggregate data we are unable to reject a linear relationship … low compared to when it is high. Nevertheless the simple nonlinear Phillips curves used here suggest a core CPI inflation …

inflation are now less well informed by macroeconomic conditions; because expectations are important in the setting of current …-period prices, inflation is therefore less sensitive to macroeconomic conditions. To distinguish between our two hypotheses, we … bring to bear information on inflation expectations from surveys, which allow us to distinguish changes in the sensitivity …