Recent Developments in the Theory of Inflation and Unemployment

Robert J. Gordon
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Robert J. Gordon: Northwestern University

Chapter 2 in Inflation Theory and Anti-Inflation Policy, 1977, pp 42-71 from Palgrave Macmillan

Abstract: Abstract Theoretical and empirical research on the causes, costs, and cures of inflation and unemployment preoccupies a substantial portion of the economics profession. Any comprehensive survey of this body of work, while perhaps providing substantial revenue for the paper and ink industries, would be too indigestible to attract serious readers. Fortunately the restrictive word limit imposed on this paper prohibits an encyclopaedic review and requires a delimitation of scope. The paper takes a selective rather than comprehensive approach and is concerned with the causes of inflation and unemployment but not with their costs and cures; with theoretical developments but not with the results of empirical tests; and with papers written during the last decade but not those written earlier.2 The paper’s scope includes the causes of unemployment as well as inflation, because the most interesting recent papers have treated both phenomena as part of a single analytical problem, for instance, those which model the optimal adjustment by firms of employment and wage rates in response to unexpected changes in product demand.

Keywords: Wage Rate; Money Supply; Rational Expectation; Monetary Authority; Wage Rigidity (search for similar items in EconPapers)
Date: 1977
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Persistent link: https://EconPapers.repec.org/RePEc:pal:intecp:978-1-349-03260-0_2

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DOI: 10.1007/978-1-349-03260-0_2

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