The Phillips Curve (OCR A-Level Economics): Flashcards
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NAIRU definition
NAIRU definition
Level of unemployment where inflation remains stable, neither accelerating nor decelerating
Natural unemployment components
Natural unemployment components
Frictional and structural unemployment
Natural unemployment excludes
Natural unemployment excludes
Cyclical unemployment
NAIRU threshold meaning
NAIRU threshold meaning
Level below which inflation accelerates
Keynesian AS equilibrium location
Keynesian AS equilibrium location
Can be below full employment
Keynesian AS horizontal region effect
Keynesian AS horizontal region effect
Higher output, no price increase
Neo-Classical AS curve shape
Neo-Classical AS curve shape
Vertical at full employment
Keynesian policy approach
Keynesian policy approach
Active govt intervention to manage demand
Neo-Classical policy focus
Neo-Classical policy focus
Supply-side policies
Phillips Curve shows relationship between
Phillips Curve shows relationship between
Inflation and unemployment
Short-run Phillips Curve relationship
Short-run Phillips Curve relationship
Inverse: higher inflation, lower unemployment
Long-run Phillips Curve shape and position
Long-run Phillips Curve shape and position
Vertical at natural rate of unemployment
Long-run inflation-unemployment trade-off
Long-run inflation-unemployment trade-off
No trade-off exists
Expansionary policy short-run effects
Expansionary policy short-run effects
Lower unemployment, higher inflation
Reducing unemployment below natural rate long-run
Reducing unemployment below natural rate long-run
Only causes higher inflation