Work

Productivity Growth and the Phillips Curve

Year: 2001

Type: report

Abstract: We present a model in which workers' aspirations for wage increases adjust slowly to shifts in productivity growth. The model yields a Phillips curve with a new variable: the gap between productivity growth and an average of past wage growth. Empirically, this variable shows up strongly in the U.S. Phillips curve. Including it explains the otherwise puzzling shift in the unemployment-inflation tradeoff since 1995.

Source: National Bureau of Economic Research

DOI: 10.3386/w8421

Authors: Laurence Ball, Robert Moffitt

Institutions: International Monetary Fund, National Bureau of Economic Research, Johns Hopkins University

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: green

OpenAlex ID: W1894795370

Cites: 16

Cited by: 165

Related to: 10