implications for the unemployment-inflation tradeoff and for the conduct of monetary policy.We proceed in two steps. We first leave … firms. We derive the relation between inflation and unemployment and discuss how it is influenced by the presence of labor … market frictions and real wage rigidities. We show the nature of the tradeoff between inflation and unemployment …

unemployment on inflation, for given expected inflation, decreased until the early 1990s, but has remained roughly stable since …-recession trend, suggesting hysteresis. Second, while inflation has decreased, it has decreased less than anticipated, suggesting a … breakdown of the relation between inflation and activity. To examine the first, we look at 122 recessions over the past 50 years …

Inflation dynamics, as well as its interaction with unemployment, have been puzzling since the Global Financial Crisis … forecast scenarios. We show that financial and external variables have the highest forecasting power for inflation and … unemployment, post-GFC …

Low rates of inflation have been recorded in recent years, despite a decline in the unemployment rate. This phenomenon … explain the recent behavior of inflation. A leading explanation for recent inflation performance appears to be favorable price …

that this may have contributed to more elastic aggregate supply in recent years, which is consistent with lower inflation …