Social Sciences and History / Unit 15 SSH 1422 short lesson, about 20 seconds
No Social Benefit to Inflation; A Vertical Phillips Curve
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The idea
Neoclassical economists see no social benefit to inflation. On a Keynesian upward-sloping AS curve inflation arises near full employment; on a vertical long-run curve it accompanies no rise in output. A vertical aggregate supply curve implies a vertical Phillips curve.
In practice
Friedman, in the anchor: a temporary tradeoff, never permanent.
Where people slip
Short-term gains vanish, leaving inflation.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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