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Online Publication Date: 01 January 2008 To cite this Article: Dimand, Robert W. (2008) 'Edmund Phelps and Modern Macroeconomics', Review of Political Economy, 20:1, 23 - 39 To link to this article: DOI: 10.1080/09538250701661798 URL: http://dx.doi.org/10.1080/09538250701661798

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ROBERT Macroeconomics Modern and Phelps Edmund 2008 January 23–39, 1, Number 20, Volume Economy, Political of Review O:10.1080 DOI: print 0953-8259 ISSN [email protected] Email: Canada. 3A1, L2S Ontario Catharines, St. Address Fisher, (cf. Correspondence rates inflation past that of argued lag distributed They a 1896). on is expectations Fisher, in depends inflation 1926 errors expected of interest to of that nominal adaptively equation responding so as change Fisher endogenous, (just is of the inflation inflation expected rate in of rate inflation the expected expected that the postulating on Phelps. depends by before years 30 and economics in laureate Friedman the Nobel Milton and the Academy’s by hypothesis was and The rate low who (1967) policy.’ natural (1968), Phelps of by the future expectations curve of facilitating Phillips introduction to expectations-augmented thereby the leads on future, depend today focuses the future announcement inflation the in Low in also policy ‘Mr. decisions: Nobel. inflation stabilization that policy Alfred Sweden of emphasized today’s of possibilities Sciences of on the of Memory Bank how Academy in showed Swedish Royal Science Phelps the the prize, Economic Political awarded the in of Announcing Professor was Prize McVickar Riksbank) University, Phelps, (Sveriges Columbia (Ned) S. at Edmund Economy 2006, 9, October On aua aeo nmlyeta ucino h elsrcueo h cnm:real economy: the interest of real structure and tariffs, real subsidies, the taxes, rates. of exchange technology, function and the supplies, a analyzing factor as economics, direction demands, Phelps Classical unemployment sectoral structuralist New of macroeconomics. non-monetary, from rate a and do natural in Friedman’s models from rate how distinct the natural dynamics changed to developed the information, and led subsequently on ‘The price, (1968), work imperfect article , His of Friedman hypothesis. of under critique with 1961 rate foundations together natural 1967–68 microeconomic his trade-off, the His choice-theoretic and curve since growth. curve Phillips Phillips economic macroeconomics the expectations-augmented optimal of of on stability development Accumulation’ the of the Rule in Golden figure central BSTRACT / hlsadFida xeddtePilpcretaeofbteninflation between trade-off curve Phillip the extended Friedman and Phelps 93 nwihIvn ihrcreae Suepomn ihadistributed a with unemployment US correlated Fisher Irving which in 1973, / 09538250701661798 dudPep,wne fte20 oe rz nEoois a ena been has Economics, in Prize Nobel 2006 the of winner Phelps, Edmund / SN16-92online 1465-3982 ISSN oetW iad eateto cnmc,BokUniversity, Brock Economics, of Department Dimand, W. Robert : / 08 / 010023–17 # 08Tyo Francis & Taylor 2008 Downloaded By: [informa internal users] At: 15:43 9 January 2008 aua ae(ua,tgte ihLoadRpig a otiue oPhelps to contributed the had around Lucas was Rapping, fluctuations Leonard While al. cause markets with (1972a). misperceptions together et Phelps communicating (Lucas, monetary by rate how imperfectly natural at and of looked (1969), (1981) model’ Phelps foun- expec- by the ‘islands introduced hypothesis, choice-theoretic The rate and natural dations. curve, the with Phillips associated tations-augmented breakthrough great one 811). p. than 2004, doctrine be (Leijonhufvud, rate can natural expectations’ case the rational ‘A from from more remarked, stems Leijonhufvud macroeconomics Axel path-breaking modern of As that series made 1972. a That to in fluctuations. associates 1967 his from and and publications Phelps inflation, by employment, achieved been respon- of already had not analysis uncritically foundations were macroeconomic microeconomic means choice-theoretic economists the the Classical no on of emphasis New modern by the the for But but an sible 1983). predictions), sympathetically Phelps, their evaluated & of in (Frydman hypothesis errors Phelps New the systematic that work. introduced no approach markets (1981) make (agents Lucas labor expectations Robert how of rational as to underpinnings such regard economists choice-theoretic with Classical the particularly variables, on aggregate attention focusing macroeconomics, he iePep 16) u oemninPep 16) ae abat i Stiglitz (in Galbraith James (1967). Phelps mention none but (1968), Phelps cite three soito,a ls seooit e odlvr rmOyps,ta Prasn te presiden- other no influential.’ ‘Perhaps so that been Olympus’, ever from delivery has Economics to address American get the tial economists to as lecture presidential close 1968 as remarkable Association, Friedman’s ‘Milton of writes 93) p. to,wswdl influential, widely was ation, see expec- – adaptive trade-off that inflation-unemployment Friedman the to for analyzing 2000). menu in suggested Leeson, a useful have the offered be even that data would of think may British tations not expectations in and did found change choice, Phillips had will policy (A.W.H. policy he shift. it for correlation to menu historical along trade-off interesting a move the not cause deliberately thus and to is rate inflation, unemployment curve attempt inflation of Phillips non-accelerating any rate The (the choice: the NAIRU). because rate and or natural inflation, expected, unemployment, its increasing of be towards of to back a come gravitate cost produce would would not the inflation could at higher policy unemployment the monetary in Expansionary reduction changes). lasting level price of lag 24 1 yPep 16,16,16,17a 99 n bv l y‘h hlsvolume’ Phelps ‘the by all above and 1979) 1972a, (Phelps 1969, dynamics microeconomic 1968, wage the (1967, money Phelps into a and by led inflation, in were unemployment, economists, analysis, employment, working previously, technical of However, foundations and had unem- formal inflation). more between steady 1966, for relationship of looking stable (Friedman, rates any different first denied and volume, ployment print conference a in in comment appeared (1967) Phelps nasxpprsmoimo AR (Stiglitz NAIRU on symposium six-paper a In u hr smc oet hlsscnrbto oeooista utthat just than economics to contribution Phelps’s to more much is there But remns(98 rsdniladest h mrcnEooi Associ- Economic American the to address presidential (1968) Friedman’s Dimand R.W. 90,Pep 19)dvlpdasrcuaitmcocnmc that macroeconomics structuralist a developed (1994) Phelps 1970), , tal. et 90.Ti oyo okroine h ehdlg fmodern of methodology the reoriented work of body This 1970). , 1 seilyaogplc-aes vnthough even policy-makers, among especially tal. et 97,alsxppr ee oFida (1968), Friedman to refer papers six all 1997), , tal. et 1997, , Downloaded By: [informa internal users] At: 15:43 9 January 2008 oiae i nunilsuyo ttsia hoyo ailadgender Enter- and on Free books to his racial Self-Support contributions, and important what of Participation most motivates Restore prise his to also theory among How It rank Work: statistical to 1972b). Rewarding out 1972a, turn of processes (Phelps, well economic markets may study of labor & morality accumulation Phelps in influential and also discrimination capital justice see his of the 1966b; with rules’ 1966a, motivated concern ‘golden 1965c, This on 1961b, 1969). trade-off (Phelps, Shell, work gener- the growth early future of economic by his analysis and consumption with Phelps’s and research starting Sciences, generations of ations, current of justice body by Academy second economic consumption the Swedish between with motivated the concern concern by This cited personal 1975). 1973b, and Phelps, (see scholarly longstanding, serious, h etro aiaimadSceya oubaUiest’ Earth University’s Columbia at capable of theorists volume top-level Society inaugural of the elite the and the in of among publishing design unusual Capitalism of highly of society’s is 2001 on since Phelps in director Institute, justice Center As exchange. constitute and the would production motivating what structure (1971) reward to Rawls John attention while serious Sciences finishing Behavioral Private the there in in was Employment Study Advanced and for Pay Center Low-End Raise to Enterprise Tools Inclusion: Designing et(e loFtus hls 96 98 hls&Zea 97 98 2001; 1998, Hoon 1997, 2007; Zoega, 1997, & 1992, Phelps unemploy- Phelps, 1988; of 1986, & rate Phelps, Hoon natural & the Fitoussi in also changes (see as ment slumps and booms structural analyzed ehooyo oehmncptl sawyo asn uptademployment; and output those raising those of hand, hand, way ‘a other one a the sees as on the the capital) Phelps and, human promotes on on economics: more that or emphasis secure for between, technology economy the to significance making good put practical job, the the would direct, and the in about life, a do reflections debate good have philosophical cannot the life rewarding; These justice, alone good and 558). economy of dynamism p. engaging nature acceptable 2007, if amply the need morally (Phelps, work justice, which inclusion’ ‘a make development, enough ample to happiness: personal have dynamism precedents and reported of and enough challenge essence citing with have of the correlated proposes, that career must self-realization, a be He typically of is not theorist. concept might life Rawls’s good what macroeconomic John the beyond to a Innovative inquiry Aristotle Economy: of from philosophical Good expected serious ‘The be constitutes a what Inclusive’, of and consideration to just not Lecture all, for rewarding economic and bringing inclusive to capitalism energy make fortunate. to and the how talents on his bear devote to to theory choosing in 1969) Shell, & eom flbrlw opn a,adtefiaca etr Pep,2007, (Phelps, sector’ financial through the activity and business law, general company and 557–558). law, activity pp. labor innovative of into reforms resources ing hlsas tnsotfo te areooi hoit nhvn a having in theorists macroeconomic other from out stands also Phelps hls(07 p 5–5)dvtdtecnldn eto fhsNobel his of section concluding the devoted 554–558) pp. (2007, Phelps Pep,1997), (Phelps, Pep,20b.Siuae ysedn 997 tStanford’s at 1969–70 spending by Stimulated 2003b). (Phelps, hoyo Justice of Theory A nepieadIcuini Italy in Inclusion and Enterprise dudPep n oenMacroeconomics Modern and Phelps Edmund pushing modernizers oersucsit h cnm (more economy the into resources more hls(97 95,p.9–9 gave 98–99) pp. 1995a, (1987, Phelps , tal. et ora fEooi Theory Economic of Journal h ao taeyof strategy a favor who 2005). , Pep,20a,and 2002a), (Phelps, neoclassicals pulling (Phelps exist- who 25 Downloaded By: [informa internal users] At: 15:43 9 January 2008 hl netetsre omdriea ela oices h aia stock capital the increase to that as emphasis well Phelps’s as was before, modernize years to seven serves or of articles investment six the while to Tobin relative and (1962b), Phelps Swan, in Solow, exposition simplified a of and (1962a), ewe aia n ao nta fteHro–oa supino titcom- production. strict of substitution of factors assumption with two model the Harrod–Domar the growth between of plementarity a by instead developing labor Swan and in formulation Trevor capital (1955) 1957), between Tobin the (1956, James Solow and of Robert (1956), following reminiscent firms, profit-maximizing quite by with ‘is Tobin, ago.’ mark-up years James analysis thirty the contemporary of (1959), teachers, Fellner that Fellner over William remarked his teachers, 98) struggles his of p. of (1990a, of another retrospect) Phelps one topic. in credits of the coincided time, low suggesting (1995a) topic that enviably of Phelps at choice seem interests, Phelps’s although that factors. research demand-pull rates the or US at with cost-push whether (running to on due literature 1950s pub- was empirical (1961a) the then-burgeoning Phelps in the economics. of inflation in part dissertations was was there, doctoral Phelps lished Yale time on the problems At based and other economies.’ articles the asymmetric real of published of plague host Yale that vision there, a reward word) and and (his coordination compatibilities, modernist of incentive ‘a as information, 179) imperfect Text p. innovative Introductory (1987, his Weinstein in An 1962b). later Economy, much Phelps, and reflected itical was (e.g. policy-oriented course undergraduates courses acces- of beginning economic economics to modern economics series sible state-of-the-art of making undergraduate Economy with principles concern for long-time Modern professor Phelps’s the associate After readings the visiting of of a 1959. of as charge books Problems in year taking a Norton’s economics (with returned editing 1966 1962–63), Phelps in to MIT, (1959–60), 1960 PhD from Corporation at Yale RAND his at the teach at received to a He an Tobin, as Econ- (like laureate). of working Schelling Council Thomas Nobel President’s microeconomists, the of future among Wallich, was members and, point Henry he (Phelps, Advisers), some where Fellner, at omic University, was courses’ William (all Yale courses Okun Tobin, other at Arthur of James studies [but] and the set postgraduate macroeconomists analysis one his in by of did in influenced sort macroeconomics He taught the 91). formal microeconomics the subject p. a the to 1995a, with to his that possible about in communicating sense was read course vague it not had economics a that I an see had newspapers to I trying those impressed into in hugely him from was events cajoled graduated ‘I father He year: his in second 2006). majored but have (Henderson, who would Amherst, parents He Depression 1955. to at Great in 1933, Massachusetts the 26, in College July in Amherst on jobs Illinois, their Evanston, in lost born was Phelps Edmund Beginnings 1. 26 2 hlstuh oreo aia hoywt oetSlwwievstn I n1962–63. in MIT visiting while Solow Robert with theory capital on course a taught Phelps hls(92)cnrbtdt h ecasclter fivsmn decisions investment of theory neoclassical the to contributed (1962a) Phelps Dimand R.W. aeEooi Essays Economic Yale Pep,18) ecie yMichael by described 1985), (Phelps, ora rmrl eoe to devoted primarily journal a , 2 h oe etr fPhelps of feature novel The Pol- Downloaded By: [informa internal users] At: 15:43 9 January 2008 n16.‘e, eal hls(95,p 93), or p. encouraging (1995a, Phelps policy recalls path. appropriate ‘Yet,’ growth 1966. the state in steady on desirable light most the shedding achieve theorizing, in to pure in saving so to exercise discouraging propensity abstract more the an of as even interesting independent is but in growth machines state of steady capital age in and, vintage of save average are classes elders understanding the the and which peers out of in his Sorting when virtuosity.) models theoretical sake world technical real assist- his the young the pursue of in a aware interest for for already not an easier such course, but take of did to is, professor sake, (It ant He world. real own the shrinking). improving its feasible, where is for bal- money power primarily real holding brilliance purchasing on welfare economize whose economic to affects transactions ances agents costly in economic even engage by how people off: expected analyzed (as better (1965b) correctly Phelps is people while that make welfare, consider inflation 1966b) to maximizes 1966a, path inclusive, policy 1965c, growth 1961b, more and (Phelps, which capitalism growth theory economic economic make on of using rules’ to work with ‘golden later reforms concerned his structural was presaging designing Phelps all, on of and Most justice volumes). edited from (apart fhsYl eces ..Tbn 95adFlnr 99.Hsitrsslywith policy, lay public interests of His issues 1959). crucial Fellner, to in and relevant as 1955 was but that Tobin, influence research e.g. the technically-rigorous 1962), (and teachers, skills Yale technical Allais, his remarkable his of beyond also fuller. publications, issue early his the Allais (see in of Maurice exploration money, economists his to and for Anglophone independent appendix demand in was mathematical formulation to transactions investment Phelps’s the net for unknown of in rule share (1947), root discerned model of the generations accumulation square subsequently overlapping to of was Samuelson’s Baumol–Tobin equal rate Paul the attainable output the like highest in and to rule, golden equal its profits Accumulation’ accumulation The is achieves of output). of rate economy capital share Rule profit scale (the affects 1961b, the Golden to capital policy when ‘The (Phelps, returns path tax 1969). constant accumulation consumption a Shell, how capital that & on holds optimal Phelps and 1965a; on labor 1966b) (Phelps, and work 1966a, among capital his recognition 1965c, between achieved for first of substitution Phelps independent of function). economists be production elasticity indepen- such would Cobb–Douglas unitary that machines (a showed on Matthews of has Robin depends comment, economy age a the dence average In once save. the to capital), propensity state, vintage the modeling steady in a exercise reached an was his (hence, h te,aqiiga needn miia es fhwi oeoverlooked of some works. level in economy on how the and, the of hand, way raise sense one scan- misunderstood empirical to the between or independent difference on an – big implications, acquiring a would unnoticed other, done better, I their the appreciate generally for distinctiveness to models had and was I existing I I depth steps. ning as than unusual few is, of a There harder game. by anything much my footraces do think losing) to (or to was winning have I simply if was I that that saw feel to came I i al okwnPep lcina elwo h cnmti Society Econometric the of Fellow a as election Phelps won work early His eti ieln hrceitc fPep sa cnms r led evident already are economist an as Phelps of characteristics life-long Certain iclNurlt oadEooi Growth Economic toward Neutrality Fiscal dudPep n oenMacroeconomics Modern and Phelps Edmund Pep,16a,hsfis book first his 1965a), (Phelps, 27 Downloaded By: [informa internal users] At: 15:43 9 January 2008 asg nom er fhg raiiy hc eenal otnosfra for continuous nearly were which of creativity, kind a high ‘marked of 1966 January years in decade.’ Penn my to Northwes- the into Yale 93) them. from p. in for passage departure (1995a, tenure earlier his Phelps were no As it, Yale professorships. be put Debreu full would himself left Phelps Gerard there offered had that Pennsylvania and clear who and Blaug made tern distinction was Mark it of 93). when economists 1960s p. young creat- 1995a, to other resistant (Phelps, finally among was another’ Econ- President tenure largest yet the the until one been ing country, have squandered must the what in had up Department building Yale omics years, those However, in tenure. another after to slot promotion Pennsylvania with of rewarded University the macroeconomics. at do economists was how he the changed in while star rising (1966–71) published a those as recognition but him won profession, (1960–66) Yale at publications Phelps’s 28 col fmcocnmctogt.Pep 19b .1)acknowledged rate: natural 13) a of p. concept the (1995b, had having Phelps these as of (1959) Fellner overview thought). and an (1949) for macroeconomic Real Lerner 1990a, Classical, Phelps, of (see New Keynesian schools whether New macroeconomics, or that Cycle, conducted theories Business they methodology and the which models but foun- advocated, specific through they microeconomic policies the the the or not on Policy propounded conference research changing macroeconomists Price formal subsequent macroeconomics, ‘Optimal to the of on impetus dations Jr, and decisive Winter, a conference G. gave The 1968 volume Sidney Competition.’ with his Atomistic paper of under joint a version and revised authors) introduc- the to a cover addition the In contributed Economy book. on the listed in Phelps others appeared the papers tion, their with which authors, in the order among the in first listed was and duction (Phelps volume’ Phelps ‘the to preface Volume 1969 Phelps March the his and In Hypothesis Rate Natural The 2. ahrn pu w oecmisoe ocvrgp)bcm tePhelps ‘the became gaps) cover (Phelps to authors 15 commissioned more this from at volume,’ two papers 1969, ten The (plus 25–26, taught. January then gathering on Phelps pro- held where same Pennsylvania, and the was of spoke It job, University we theorems.’ the whether same price, see the to wage, thought suggested and was of language meeting were disequilibrium subjects A of we forming. the economics nearly be that to An of on seemed information. learn found all incomplete was to under fragments, Evidence decisions excited and duction campuses. were other drafts us on dozen existed of a life several Similar year alone. ‘Last not that, wrote Phelps ehp y16 ae n remnswr oeepai n explicit and 1950s. emphatic the in more mine) were of Friedman’s teacher and great output, Lerner (a paper of Abba Fellner 1967 path by William my introduced by equilibrium was and Perhaps the variables 1940s for ‘real’ the neutral other in was some and inflation employment that postulate The Oemgthv huh htti ucs tpaigtegm ol be would game the playing at success this that thought have might ‘One Dimand R.W. ireooi onain fEpomn n nainTheory Inflation and Employment of Foundations Microeconomic ril wihhdisie ayo h otiuin yother by contributions the of many inspired had (which article tal. et 90.N dtrwsnmd u hlswoeteintro- the wrote Phelps but named, was editor No 1970). , ora fPolitical of Journal tal. et 90 .vii), p. 1970, , by Downloaded By: [informa internal users] At: 15:43 9 January 2008 lydee huhte ol cetjb ttepealn elwg ra or wage real prevailing the at jobs accept unem- of involuntarily would wage. supply workers real they some excess lower though keeps an that even as valuable market-clearing unemployment ployed up of con- saw In failure giving getting. (1936) are a into they Keynes labor, think fooled they Maynard than are wage John the real to trast, workers smaller a according some for requires, exchange rate in that leisure natural hypothesis, the assumed rate implicitly than rate, less natural natural Unemployment its unique. at that be be low will to or unemployment high be, however may incomplete of inflation, rate distorting of expected level inflation other fault equals of optimal the inflation levels are actual the if optimal unemployment distorting, information: the equilibrium goods with from all public deviations jointly are But chosen for revenues taxes. be pay must tax to tax of needed inflation is sources the revenue possible of government theme the a if (also and taxation that of socially so form is a 1923), what is Keynes, than inflation the noted, greater) (1973a) distort unemployment Phelps taxes (and Also, optimal. less income be if will unemployment: employment optimal brium as inter- same of the rate consumption quite natural locations Wicksell’s not and Knut is skills to the analogy est), of called (by mix unemployment Friedman the of what rate in unemployment, natural changes Equilibrium unforeseen (mismatching employers). to by unemployment in due demanded structural jobs investment plus and voluntary leisure, workers of of as consumption unemployment’ and ‘equilibrium search termed (1967) Phelps u oehn nispae ehdlgclapoc htmacroeconomists that Phillips approach volume’ ‘Phelps the methodological 1970 of a The place.’ place, critique its its use. Friedman’s in could in put ‘Milton was something to useful put nothing refers which 103) in foundations. curve, p. choice-theoretic explicit (1995a, with Phelps dynamics macroeconomic modeling u hl enr(99,Flnr(99,adFida 16)hdteie fthe of idea the had (1968) Friedman Phelps and rate, (1959), natural Fellner (1949), Lerner while But eet hnei hi elicm u oarltv rc hf seas Stigler, also (see shift price relative a to rep- due receipts income have nominal real their their firms, in in or change change a a (households) resents whether workers about information whether imperfect agents, only because changes quantity bu oigi otentrlrt o hc a oecuiu nm 1968 my in cautious more was I which (on rate natural the paper). to in homing about rtego otn orietercagsa uha ehsrie i own.’ his raised effrontery has the he have as really much will as people charges other their raise that to first fortune at good believe the illusion to or hard D.H. in so founded few, is It partly the stimu- is ‘The and of on markups: prices of spurred monetary one behavior rising above of surprise, of the effects on quantity lus my finger price why his put To asked the study [1929], ever Robertson this accompany disturbances. who of to macroeconomic after) purposes expected (or other scholarly be Keynes the should before for writers effects literature few the up of turned search too-brief My nhsitouto oPhelps to introduction his In hls(97 98 Phelps 1968; (1967, Phelps Fisher’s / h oe Illusion Money The esr rd-f rpyoltxsdpeslbrdmn,te equili- then demand, labor depress taxes payroll or trade-off leisure ... yiaiaygisa h xes fhsflo uiesmen. business fellow his of expense the at gains imaginary by tal. et 17)soe cnmsshwt s h ocp in concept the use to how economists showed (1970) dudPep n oenMacroeconomics Modern and Phelps Edmund 12)sae htisgt rc hne cause changes price insight: that shared (1928) tal. et tal. et 17,p 0) hlsreported, Phelps 20n), p. (1970, 90 n remn(98 a what saw (1968) Friedman and 1970) ... tebsns edr is leader] business [the 29 Downloaded By: [informa internal users] At: 15:43 9 January 2008 otemdla teLcsPep oe’ iharfrnet hlssintroduc- Phelps’s to reference a with model’, Phelps to Lucas–Phelps tion ‘the once just as refers model the 241–255) to pp. 1996, (Romer, Model’ Imperfect-Information Lucas to introduction also the (see introduced (1969) markets Phelps communicating it, Phelps imperfectly with collected of associated articles model’ generally the now (in ‘islands is Lucas 1981) Although Lucas, information). in of economics the on 1961 nainwl rvtt oad n tayrt fiflto.T keep relating To equation inflation. of Fisher’s rate steady in expected any (error-correcting), as towards adaptive gravitate inflation, are will expectations expected inflation If on interest. real one and nominal of coefficient a with p 30 otnigt olwres h aeo nainwudhv oke accelerating keep to have would inflation of rate the workers, fool to continuing h etok:tescini ai Romer’s David com- in in downplayed imperfectly section is of 21) the approach parable this p. textbooks: my developing the (1995b, in on role Phelps based Phelps’s model, neutral. “islands”.’ (1972) municating and Lucas’ forecast ‘Robert correctly to systematic refers be any level if would price even policy and prices) to employment monetary shocks between random unpredictable correlation of observed why (because an changes explain to be model still islands nominal expectations would Phelps’s rational there into flows, incorporated forecasting) (learning in (1972) information expectations mistakes Lucas adaptive systematic costly Phelps, (no the by of with assumed place (1969) errors) In why, more from Phelps effects. real explain the wage. short-run shocks), money to have price the shocks framework (relative in alteration changes this any wage used to real money respond be in changes would to past employment out often more to turned The wish had not supplied). would they shock wages they labor nominal which of a (in amount to islands (in the all opposed demand change across as of wages labor), composition money more the and supply or prices to raising technology increase their wish money in an would in change represented they and a increase case this to an which that prices due island, observed likelihood wage monitoring island the real own evaluate their an continuously in to their on had workers of on they the wage, cost them If money islands. to the other offered incur on wage wages not (Phelps money would market- employment the they island’s observe that and costly’ could determining are wage morning flows workers every picture information money island to which each instructive between clearing of on it islands fraction auction ‘found of a an group Phelps only with a prices. by as own level economy price their the general in the due change of effects observed estimate quantity any their about adjusting result agents Phelps’s to preserving while expectations rational fpie eed nepce nainadtegpbtenuepomn ( unemployment between gap ( Friedman–Phelps the unemployment and and of the rate wages inflation natural money In expected the and of on employment. increase depends of and prices unantici- rate of only output the that curve, for held Phillips 1968), expectations-augmented matters (1966, Friedman inflation like pated 1968), (1967, Phelps ment. qasepce inflation expected equals ..Dimand R.W. hls(95)hdcniee hte niiae nainafcsemploy- affects inflation anticipated whether considered had (1965b) Phelps tal. et 90 p –,adPep,19a .1) owihLcsadded Lucas which to 12), p. 1990a, Phelps, and 6–7, pp. 1970, , tal. et (1970). p e : p ¼ f u ( u ,with ), u dacdMacroeconomics Advanced ) u þ qa to equal p e tal. et u 90 .6.While 6). p. 1970, , hnata inflation actual when u below n‘The on u by u ) Downloaded By: [informa internal users] At: 15:43 9 January 2008 osato lwycagn aua aeo nmlyetaeb omasas means no by are unemployment Stiglitz of rate (see with natural accepted models changing rate generally slowly Natural unemployment. or to constant output attention potential a less on with shocks demand, technology labor of Clas- and impact New nominal of the 1981) version random emphasized non-) (Lucas, unpredictable, (the sical theory to Cycle economics Business rate Real Classical natural while shocks, the New around of fluctuations The counter-productive. attributed version and government futile as misperceptions for as proposals poverty and monetary econome- and depict unique rate unemployment to natural reduce as arguments to the unemployment rate action estimate natural of to deploying attempting rate and time, natural trically over produce natural constant the loss using treat would or macroeconomists into to more that Typically, workers tended jobs). tricking search to models of workers useful policy rate of a truncating desirable matching be be best (or would even the it not leisure would because and valuable run, – short surrendering the run aggre- long in expanding the feasible by in if rate fruitless natural be its would demand below gate unemployment reduce to attempts consumption-smoothing that two-period discipline. the Fisher’s of intuition Irving IS trained the Hicks’s demand, inflation J.R. of and and rate diagram, expected downward-sloping supply particular of expec- a of family the for a drawn Phelps for and each (see diagram inflation) curves, (for famous actual to the short-run Phillips equations equal long-run drew the vertical inflation and a out expected showing dynamics wrote curve, market Phelps Phillips tations-augmented whereas labor Friedman verbally, However, the hypothesis). only for expectations output intuition rational real this the and by presented employment out stimulated ruled systematically be would for possibility that (even ntetredcdssne17 saprgahaotPep 19) lsapassing a plus (1994), Phelps about paragraph a published is has 1978 Phelps since that only decades anything the three to 1983), the makes Phelps, in Academy & Expectations Swedish Frydman the Rational (in that with Stabilization’ Macroeco- these reference Swedish Inflation Trouble to of Royal ‘The of Problem on Contributions the the paper by Phelps’s Neither and Phelps’s summary ‘Edmund from prosperity. 33-page of Apart the (2006) general nomics.’ in Sciences out the of brought margina- in Academy is lower currently Phelps of workers will of inclusion that impoverished aspects the measures secure is and and He constructive unemployment rate. lized for of natural rate quest the natural changing the the without to goals those committed pol- achieve fruitless passionately policies to misguided, governmental opposes attempt to he opposed that rather, he icies poverty: is and Nor unemployment fluctuations 1994). reduce about Phelps, rekindling to (e.g. theorizing rate structuralist without natural to the himself be, in devoted has to he similar. Instead, been believed time. has experience was Canadian recently, NAIRU unem- more held and, have what half British a below inflation. and decade market well past and the ployment in information expansions imperfect US Prolonged recognizing frictions. macroeconomics of foundations Phelps h oiyipiaino h remnPep aua aehptei was hypothesis rate natural Friedman–Phelps the of implication policy The u hlsddnttiko h aua aeo nmlyeta osatover constant as unemployment of rate natural the of think not did Phelps But tal. et tal. et 17)aottene o xlctcoc-hoei microeconomic choice-theoretic explicit for need the about (1970) 90 .18.A ihAfe asals‘csos diagram ‘scissors’ Marshall’s Alfred with As 148). p. 1970, , / dudPep n oenMacroeconomics Modern and Phelps Edmund Mdarm ipedarmsre ocapture to served diagram simple a diagram, LM tal. et 97 stemtoooia esg of message methodological the as 1997) , 31 Downloaded By: [informa internal users] At: 15:43 9 January 2008 32 nwihFtus hls(96 98 grdpoiety o hthswork his that not prominently, figured 1988) (1986, Phelps & Fitoussi which in ira otoei hlssrve ril nLayard on study article Academy Swedish review the Phelps’s of in authors ‘myfeelingsthatwhatIrefertoasthe footnote or author a ‘unemployment the in misread interest Possibly Nickell Phelps’s book. and and valuable curve, Layard wage of Phelps the mention ing & on passing an and Fitoussi authors as one of of Nickell, considered has index list Stephen or 98) a references Layard, p. in the Richard (1990a, in Phelps of appear (1988), from not names do starts The Jackman Richard 1978a). inspired 469–473) not (1972a, were & (1983) Phelps pp. Fitoussi Phelps the & However, Layard whereas Calvo Phelps. (1996, Swedish and by (1972a), of (1988), Phelps The Romer mention Phelps 1988), without (1986, hysteresis. to Phelps (1986) David Summers hysteresis of & by of analysis Blanchard concept textbook 1972 the equilibrium his widely-read endogenous trace an on did of changes based Academy structural a rate of revival (1991).’ unemployment the Jackman in and a role Nickell to Phelps’s Layard, years, of twenty work last com- the the a by of over inspired part developed forms extent has work large that ‘This given): literature details research other prehensive or dates (no articles’ journal n ae h eeomn rmwihtewr ne eiwses (Phelps, stems’ review Layard under is, work that the – which 1477n) from p. development 1992a, the case, any equilibrium 0 41) o,aogPep’ ale rtns osteRylSwedish Royal the does writings, on edited earlier he books Phelps’s pp. the 2006, among cite Academy, (2006) Swedish Nor, Academy (Royal turnover 14–15). labor between its relationship 10, and the wage considers relative (1994) firm’s Phelps a (1968), Phelps like that, remark ihafont eeec o‘h nunilsuyo uoenuepomn by unemployment European of study influential ‘the to Layard reference footnote a with that noted 14) p. (2006, Sciences of Academy Swedish Royal The Macroeconomics Structuralist 3. nmlyetas e hlst td h tutrlcue eemnn equili- determining causes structural the in study unemployment to brium Phelps led also unemployment eta otoeboscnb ena oiaighsmcocnmcresearch. macroeconomic his motivating as seen be can books those to Theory central Economic and Morality ec noutr’(hls 92,p 46 rdtn hi motn and important their predating 1476) p. 1992a, (Phelps, involuntary’ hence , atn otiuinfo hsbo [Phelps, book Theory this ment from contribution lasting A goe o oeta eae u aet ieaani h i-90 when European mid-1980s the in in rise a again permanent life as seemingly to the irreversible, unemployment came understand but to (partially) decade, morale struggled be a economists and than to skill more of for out loss ignored turn workers’ may of result unemployment in increase ..Dimand R.W. hsbifacutb h oa wds cdm fSine underplays Sciences of Academy Swedish Royal the by account brief This tal. et aaimi h eia eeomn fteps eaead in and, decade past the of development seminal the is paradigm , tal. et 19)’TeSeihAaeyaddta h essetEuropean persistent the that added Academy Swedish The (1991).’ 92]i h daof idea the is 1972a] , qiiru phenomenon equilibrium 19) hc hypeae,btisedbitdrcl upon directly built instead but predated, they which (1991), tutrlSlumps Structural Pep,17b 95,atog h concerns the although 1975), 1973b, (Phelps, tal. et hysteresis structuralist 19)semdfo oyo work of body a from stemmed (1991) pign from springing ... 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(1995a, Phelps economies. of in property the rate inherent policy). about exchange an fiscal real as however, and US monetary questions, the US of of raises result appreciation (which another expansion the 1980s, fiscal of interest In the US exports capital. real the European human by up on offset impact and pushed not rates physical was had interest investment in that real of investment raised tight contraction sharply the reducing the Europe, Reserve) with world, Federal (together cuts, the Volcker deficits tax throughout the budget Administration’s high of Reagan record policy to Reagan the and money strongly The of spending, contributed 1980s. policies defense but the fiscal increased US in the the that unemployment for claim European expansionary the and is were economics approach Administration supply-side application structuralist thought-provoking on on notably this random One chapters incentives 1990a). of emphasizes the Phelps, tax in which (see cycles of theory, supply-side business growth real cycle impact Zoega from productivity business the apart & to real on approach shocks Phelps from their narrowly and 1994; supplies, sets more Phelps, factor This focuses and 1988; 2007). Hoon which 1986, Phelps, Teck economics, Phelps, & Hian Fitoussi, Hoon & Jean-Paul 2001; (Fitoussi associates Zoega his con- and Gylfi distinctively deter- more in Phelps rate is with exchange economy introduced real open accepted, nected and hysteresis an rate in generally of interest unemployment real concept is equilibrium the the mining of 1990s, role use the The macroeconomists and (1972a). for Phelps most particular 1980s by not in the if and many employment, of and for unemployment matter on European workers restrictions and of high benefits, firing unemployment and taxes, hiring exchange payroll real the on That and rates. legislation, unemploy- interest market of labor and rates and past taxes on dependence payroll rate) the (hysteresis), natural emphasizes ment (the 1983) rate Taylor, unemployment Lance equilibrium by the term of same the of usage nesian o upiem htagetmn cnmsswl att e hte they whether see to would far. want It so will work. by, economists this persuaded many by am great challenged better. felt a I do also that that can have me volume I surprise this reason not very in that findings of findings. for their that many Maybe in alongside not confidence apparent variables much are no have explanatory is There cannot their we there of variables no Since economic influence balance, it. standard the trade underpin the analyze as to par- to such political provided effort variable, and of macro is social corpus a variable some whole in on open-economy the throw focus do nearly a they out of When throwing favor ameters. in in risk theory huge equilibrium a general taken have authors The ainlepcain qiiru.Tesetcs n otlt htresearch that the hostility to and converging model scepticism from model that The different agents using quite equilibrium. are prevent some agents rational-expectations to may has other switched problem he not the since have tations-of-expectations quantitatively, they expectations how, if his of even form idea or to model no analyst’s or the little use cannot agent An rda hls(93 xrse eevtosaotrtoa expectations rational about reservations expressed (1983) Phelps & Frydman Key- Post the from distinct is (which macroeconomics structuralist Phelps’s dudPep n oenMacroeconomics Modern and Phelps Edmund tal. et ... 19) Phelps (1991). h expec- the 33 Downloaded By: [informa internal users] At: 15:43 9 January 2008 hoy(seepie ySmesn 97 o having for 1947) Samuelson, economic neoclassical by criticizes exemplified 544–545) (as pp. theory (2007, Phelps Lecture, Nobel his In 34 tutrlsupi h 90 oPep 18,19) hls&Zea(2001) Zoega & Phelps Europe’s 1994), on (1988, Phelps 1988) (1983) to (1986, Phelps work 1980s Phelps & of the & Calvo body in Fitoussi through important slump and unemployment hysteresis structural and equilibria on equilibrium substantial non-Walrasian (1972a) a the on Phelps development, in from continuous changes looking stretching a slumps, Layard of and is by booms determinants rate, structural inspiration on non-monetary supposed work (1994) Swedish Phelps’s the at Phelps contrary, stressing Royal giving the decades, On paragraph, the three (1991). passing con- last But who the a someone in as backward-looking. that only Phelps macroeconomics of to part evidence picture little misleading in empirical tributed quite a least informational by gives (2006) the at buttressed Academy is about are expectations, much (1983) as Phelps That (2006), & (1969). Sciences of Frydman Phelps of in requirements Academy of reservations Swedish model’ Royal Phelps’s the ‘islands are ‘Phelps by The the and notably model. recognized, information as formal well imperfect such a to frictions, of subject market context macroeconomics the of in foundations economic so did Phelps (Phelps supply volume’ only excess Keynes’s but of place labor, in advan- of unemployment introduced curve, equilibrium of Phillips independently concept expectations-augmented each the the cing 1968) and hypothesis (1967, rate Phelps natural the and 1968) (1966, Friedman Conclusion 4. cecs(06 rHnesn(06,wopee oclbaetePhelps– Classical New the for of celebrate stage Academy to the Swedish setting prefer Royal as who the simply hypothesis economics. (2006), as rate such Henderson natural those, structural Friedman or uncertain by Phelps’s of (2006) with stressed view his Sciences As not unemployment, 3). of is rate Ch. equilibrium knowledge 1990a, changing a Phelps, of also modeling (see hypothesis tations 0ya-l eea uha yefwohdse h atc f‘cr n deri- near and before. a ‘scorn used for of phrase, even tactics see, memorable the to Johnson’s seen sad Harry had was in who profession myself sion’, the as in such met veteran this 50-year-old as basic admirably so iwteeooya nlsdfeetfo ecascltheory. neoclassical could from I different perspective, angles modernist at this economy assimilated the personal degree view Polanyi’s a M. to uncertainty, I and Having Knightian know-how Schelling, of knowledge. private Thomas concepts Hayek’s and modernist probabilities, Fellner the Keynesian with William familiarity teachers development some my employee gained through intellectual intense part disequilibria, in workers’ activity, RAND, business and in swings engagement, big the endogenize, growth, or rapid and capture, not knowledge, could of it phenomena result specialization a As beliefs, solving. of problem diversity ambiguity, uncertainty, abstracted ..Dimand R.W. hsapoc oicmlt nweg otat ihtertoa expec- rational the with contrasts knowledge incomplete to approach This rmthe from htaeedmct h oeneooy–invto,wvsof waves , – economy modern the to endemic are that tal. et 90 akdamjravnei hietertcmicro- choice-theoretic in advance major a marked 1970) , itntv character distinctive ftemdr cnm h endemic the – economy modern the of ... tYl n at and Yale At observable tal. et Downloaded By: [informa internal users] At: 15:43 9 January 2008 las .(92 h nuneo h aia-uptrtoo elntoa income, national real on ratio capital-output the of influence The (1962) M. Allais, nihflacuto hr hlssad nmacroeconomics: in stands Phelps where of account insightful hlsde o utdsrb h qiiru nmlyetrt eproposes he 2003b). – 2002a, rate 1999a, unemployment equilibrium 1997, it. the (Phelps, change describe to society just devising of not in self-sufficiency to the does marginalized facilitate Phelps theorist and and incomes capit- economic poorest the make raise an to the theorist, to incentives and as abstract tax inclusive and high-brow, more expertise reforms, alism mere market his the no labor devotes policies, about is macroeconomic 1975, who and passionately 1973b, 1971), somehow (Phelps, cares Rawls outcomes but He and by processes influenced (2006). over- economic 1987, Phelps of Academy of morality Swedish characteristic and central justice Royal another to in attention looked draws remark last The supply- Keynesian, approaches. competing Classical empirical against New stresses forthcoming). 1998) and macroeconomics Zoega, 2007, side, & structuralist Phelps, Phelps & of 1994a; (Hoon Phelps, testing present (e.g., work the this to of on Much and booms, structural on ele,WJ 15)Dmn nain otiflto,adcletv agiig n ..Bradley P.D. in: bargaining, collective (1896) I. and Fisher, inflation, cost Pareto inflation, its Demand (1959) equilibrium: W.J. general Fellner, non-Walrasian of model problem, A unemployment (1983) European E.S. the Phelps, and & Hysteresis G.A. (1986) Calvo, L. Summers, & O.J. Blanchard, (1947) M. (2004) Allais, (Eds) M. Woodford, & J. References Stiglitz, Other R., Frydman, and P., Phelps Aghion, S. Edmund of History Works the Principal for Society European the Colander, and meetings David Society annual Thought. Economics 2007 Backhouse, Economic the of of Roger in History from participants the and comments of Pressman, helpful Steven Phelps, for Edmund grateful am I Acknowledgments (Ed.) (Ed.) Tobin Okun J. M. Arthur in: of Institution). Memory improvement, in Essays Pareto Quantities: and inoptimality Activity Economic on Papers Brookings 700–728. pp. 30(4), Phelps S. Edmund of Honor In Press). University Macroeconomics: Princeton Modern in Expectations lyeti o nefiin tt u n htmgtptnilyb improved be demand. potentially aggregate might nominal wage that unem- inflating equilibrium of just one by rate but at not natural state albeit markets rationed the efficient policy, labor therefore, are an by Phelps, that not jobs to view is and where in the ployment Keynesians, has equilibria is New he to To all What rates. above school. down this Keynesians settle to New will close the develop- remains ‘New the with and in a role common Keynesianism than important New an rather played of has ‘structuralist’ ment he a 1990a), Phelps, as (cf., himself Keynesian’ distinguishes Phelps Although ejnuvd(04 p 1–1,rveigAghion reviewing 814–815, pp. (2004, Leijonhufvud h ulcSaei no Power Union in Stake Public The prcainadInterest and Appreciation E ˙ ooi tInte et conomie ´ re dudPep n oenMacroeconomics Modern and Phelps Edmund ˆ t Prs mrmreNational). Imprimerie (Paris: NwYr:Macmillan). York: (New 961,p.15–78. pp. 1986(1), , Caltevle nvriyo ignaPress). Virginia of University (Charlottesville: p 3–5 Wsigo,D:Brookings DC: (Washington, 135–157 pp. , areoois rcsand Prices Macroeconomics, nweg,Ifrain and Information, Knowledge, tal. et 04 ie an gives 2004) , Pictn NJ: (Princeton, Econometrica 35 , Downloaded By: [informa internal users] At: 15:43 9 January 2008 on ..&Pep,ES 20)Asrcuaitmdlo h ml pneooyi h short, the in shocks, budgetary economy and open fiscal small Future (Forthcoming) the E.S. growth of Phelps, a model & crisis H.T. structuralist jobs Hoon, A the (2007) is E.S. rate: Phelps, natural & the and H.T. wealth Hoon, Growth, (1997) E.S. Phelps, & H.T. Hoon, on ..&Pep,ES 19)PyoltxsadVTi ao-unvrmdlo h ‘natural the of model labor-turnover a in VAT and taxes Payroll (1996) E.S. Phelps, & H.T. Hoon, on ..&Pep,ES 19)Mcocnmcsok nadnmzdmdlo h aua rate natural the of model dynamized a stagflation in solved shocks who Macroeconomic Professor (1992) E.S. job: Phelps, your & for H.T. thank Hoon, to him have might You (2006) N. Henderson, (1983) (Eds) E.S. Phelps, & policy, monetary R. of role Frydman, The (1968) M. Friedman, iosi .P,Jsa,D,Pep,ES og,G 20)Roso h eetrcvre:labor recoveries: recent the of Roots (2000) G. Zoega, & E.S. Phelps, D., Jestaz, J.-P., Fitoussi, (1928) I. Fisher, ua,RE 17)Epcain n h etaiyo money, of neutrality the and Expectations (1972) aspects, R.E. theoretical Lucas, some – process inflationary The (1949) A.P. Ned, Lerner, Celebrating (2004) A. Leijonhufvud, (2000) (Ed.) R. Leeson, hls ..(92)Tenwve fivsmn:anolsia analysis, neoclassical a investment: of view new The 1955–57, (1962a) States E.S. United Phelps, the in inflation cost between of presence trade-off the a for subsidies: test labor A versus (1961a) subsidies E.S. Capital Phelps, (2005) E.S. Phelps, & A. Petrucci, (1991) R. Jackman, & S. Nickell, R., Layard, ens ..(1936) J.M. Keynes, (1923) rate, J.M. Keynes, exchange real on perspective structuralist The (2005) G. Zoega, & E.S. Phelps, H.T., Hoon, ihr .(1926 I. Fisher, 36 remn .(96 omns n ..Shlz&RZ lbr(Eds) Aliber R.Z. & Schultz G.P. in: Comments, (1966) M. Friedman, Europe, in (1988) slump E.S. Phelps, 1980s & the J.-P. of Fitoussi, Causes (1986) E.S. Phelps, & J.-P. Fitoussi, hls ..(91)Tegle ueo cuuain al o growthmen, for fable a accumulation: of rule golden The (1961b) E.S. Phelps, roe,JA hls ..(99 ntecneto pia aaini h overlapping- the in taxation optimal of concept the On (1979) E.S. Phelps, & J.A. Ordover, (1981) R.E. Lucas, eimadln run, long and medium crisis?, rate’, funemployment, of Nobel, wins Press). Examined Expectations’ ‘Rational aktrfrso rvt etrforces?, sector private or reforms market Cmrde K abig nvriyPress). University Cambridge UK: (Cambridge, p 6–7,adrpyb ..Pep ..Yai 81,p.1216 nJ .Stiglitz E. J. in 172–176) pp. 78(1), Yaari, M.E. & Phelps E.S. by reply and 164–172, pp. Economics employment?, and capital Market Labour hr rc ee n mlyetpt:wa omi etfrmny,i:W eme (Ed.) Semmler Tobin W. in: James money?, of for Honour left Routledge). In is York: Unemployment: room New what and path: Policy employment Monetary and level price share Theory n h aktPlace Market the and Blackwell). Basil York: New & (Oxford Activity Economic 237–311. pp. Fisher, Irving – curve Review Labour Statistics Review Essays , economic of model generations 103–124. pp. ..Dimand R.W. nentoa a n ulcFinance Public and Tax International . 14,p.638–643. pp. 51(4), , uoenEooi Review Economic European 1 p 193–200. pp. 31, , / 62,p.5857 erne wt omn yRCO ates 78(1), Matthews, R.C.O. by comment (with Reprinted 548–567. pp. 76(2), , 93 ttsia eainbtenuepomn n rc changes, price and unemployment between relation statistical A 1973) h oe Illusion Money The ahntnPost Washington tde nBsns yl Theory Cycle Business in Studies 36,p.7572 erne sLs n on:Idsoee h Phillips the discovered I found: and Lost as Reprinted 785–792. pp. 13(6), , h eea hoyo mlyet neetadMoney and Interest Employment, of Theory General The Ofr:Ofr nvriyPress). University Oxford (Oxford: rc nMntr Reform Monetary on Tract A ,p.28–69. pp. 1, , 962,p.487–513. pp. 1986(2), , mrcnEooi Review Economic American Ciao nvriyo hcg Press). Chicago of University (Chicago: ora fMacroeconomics of Journal ora fPltclEconomy Political of Journal ...Pilp:CletdWrsi otmoayPerspective Contemporary in Works Collected Phillips: A.W.H. ora fMny rdtadBanking and Credit Money, of Journal coe 0 .D1. p. 10, October , h lm nErp:Rcntutn pnEooyTheory Economy Open Reconstructing Europe: in Slump The NwYr:Adelphi). York: (New 135,p.549–557. pp. 41(3–5), , Cmrde K&NwYr:CmrdeUniversity Cambridge York: New & UK (Cambridge, ora fEooi Literature Economic of Journal nmlyet areooi efrac n the and Performance Macroeconomic Unemployment: ora fPbi Economics Public of Journal niiulFrcsigadAgeaeOutcomes: Aggregate and Forecasting Individual roig aeso cnmcActivity Economic on Papers Brookings () p 369–383. pp. 3(3), , Lno:Macmillan). (London: mrcnEooi Review Economic American 24,p.889–900. pp. 82(4), , Cmrde A I Press). MIT MA: (Cambridge, 92,p.227–254. pp. 29(2), , 12,p.496–502. pp. 81(2), , ora fEooi Theory Economic of Journal udlns nainControls, Inflation Guidelines, 75,p.907–922. pp. 37(5), , p 0–3 Lno & (London 107–132 pp. , eiwo cnmc and Economics of Review 21,p.1–26. pp. 12(1), , 23,p.811–821. pp. 42(3), , Lno:Macmillan). (London: roig aeson Papers Brookings urel ora of Journal Quarterly ora fEconomic of Journal mrcnEconomic American 81,p.1–17. pp. 58(1), , International 2000(1), , 4(2), , Yale Downloaded By: [informa internal users] At: 15:43 9 January 2008 hls ..(d)(1962b) (Ed.) E.S. Phelps, hls ..(1965a) E.S. Phelps, hls ..(1966a) E.S. Phelps, hls ..(98 oe aednmc n ao aktequilibrium, market labor and dynamics wage Money time, research, (1968) over of unemployment E.S. optimal rule Phelps, and inflation golden of the expectations curves, and Phillips (1967) progress E.S. technical Phelps, of Models (1966b) E.S. Phelps, accumulation, of rule golden the on essay Second welfare, (1965c) E.S. economic Phelps, and inflation Anticipated (1965b) E.S. Phelps, hls ..(99 h e ireooisi nainadepomn theory, employment and inflation in microeconomics new The (1969) E.S. Phelps, hls ..(92)Tesaitclter frcs n sexism, and racism of theory statistical The (1972b) E.S. Phelps, (1972a) E.S. Phelps, E.S. Phelps, hls ..(1980) E.S. Phelps, hls ..(92)Mny ulcepniue n h ao supply, labor the and expenditure, public Money, (1972c) E.S. Phelps, hls ..(1979) E.S. Phelps, reconsidered, planning Inflation (1978b) E.S. Phelps, hls ..(98)Dsnainwtotrcsin dpiegieot n oeaypolicy, monetary and guideposts dynamic adaptive of : model without two-country Disinflation a in (1978d) shocks E.S. fiscal Phelps, of effects Trans-national (1978c) E.S. Phelps, policy, monetary full-employment and shock Commodity-supply (1978a) E.S. taxation, Phelps, Rational (1977) E.S. Phelps, (1975) (Ed.) E.S. Phelps, (1973b) (Ed.) E.S. Phelps, hls ..(93)Iflto nteter fpbi finance, public of theory the in Inflation (1973a) E.S. Phelps, hls ..(98 okn oe fsupadrcvr rmdsubne ocapital-good to disturbances from recovery and (1990a) slump E.S. of Phelps, inflation model (Eds), working Newman of P. A & problem (1988) Milgate, E.S. M. the Phelps, Eatwell, J. and in: justice, expectations’ Distributive (1987) ‘rational E.S. Phelps, macroeconomics, with theoretical (1985) trouble E.S. in Phelps, crisis The of year (1983) a E.S. side: demand Phelps, the on Cracks (1982) E.S. Phelps, .Uaa(Eds) Uzawa H. & rs,1969). Press, 54,p.783–814. pp. 55(4), Economica 1–17. pp. 73(1), McGraw–Hill). York: (New Economy cnmcStudies Economic NwYr:WW Norton). W.W. York: (New Proceedings and Papers Review: omic NwYr:Aaei Press). Academic York: (New oeayPlanning Monetary ot,U:Pnun 1980). (Ed.) Penguin, Amsden UK: A. worth, in Reprinted 659–661. pp. oe,Cei n Banking and Credit Money, etitcatlce Archiv Weltwirtschaftsliches equilibrium, 109–123. pp. Foundation). 67–82. pp. ()p.69–78. pp. 5(1) demand, Economics of Dictionary A Palgrave: 31–41. pp. 1983, (Eds) Phelps & Frydman in: stabilization, Proceedings and Papers Review Economic American Press). Academic York: (New lrno rs e ok xodUiest Press). University Oxford York: New & Press Clarendon tal. et 64 at2,p.6871(eie,wt pedx nPhelps in appendix, with (revised, 678–711 pp. 2), Part 76(4, , mrcnEooi eiw aesadProceedings and Papers Review: Economic American e eis 43,p.254–281. pp. 34(3), series, new , ora fMntr Economics Monetary of Journal oiia cnm:A nrdcoyText Introductory An Economy: Political (1970) ee col fMcocnmcTogt h reRd Lectures Ryde Arne The Thought: Macroeconomic of Schools Seven iclNurlt oadEooi rwh nlsso aainPrinciple Taxation a of Analysis Growth: Economic toward Neutrality Fiscal odnRlso cnmcGrowth Economic of Rules Golden nainPlc n nmlyetTer:TeCs-eetApoc to Approach Cost-Benefit The Theory: Unemployment and Policy Inflation tde nMcocnmcTheory Macroeconomic in Studies tde nMcocnmcTheory Macroeconomic in Studies 32,p.133–145. pp. 33(2), , ednsi h oenTer fEooi Growth Economic of Theory Modern the in Readings NwYr:WW Norton). W.W. York: (New cnmcJsie eetdReadings Selected Justice: Economic h olo cnmcGrowth Economic of Goal The lrim oaiy n cnmcTheory Economic and Morality, Altruism, ireooi onain fEpomn n nainTheory Inflation and Employment of Foundations Microeconomic 02,p.206–221. pp. 10(2), , 0() srpitdi hls(1979). Phelps in reprinted as 100(2), , dudPep n oenMacroeconomics Modern and Phelps Edmund oilResearch Social Lno:Soko Press). Stockton (London: 92,p.147–160. pp. 59(2), , h cnmc fWmnadWork and Women of Economics The (upeet,p.145–179 pp. 9(Supplement), , 44,p.657–667. pp. 44(4), , NwYr:WW Norton). W.W. York: (New 22,p.378–381. pp. 72(2), , NwYr:WW Norton). W.W. York: (New o.2: Vol. , o.1: Vol. , wds ora fEconomics of Journal Swedish NwYr:WW Norton). W.W. York: (New Economica Hrmnsot,U:Penguin). UK: (Hardmondsworth, mrcnEooi Review Economic American ora fPltclEconomy Political of Journal 82,p.346–350. pp. 78(2), , ora fEooi Theory Economic of Journal mrcnEooi Review Economic American eitiuinadGrowth and Redistribution mlyetadInflation and Employment NwYr:RselSage Russell York: (New e eis45(178), series new , Cmrde A MIT MA: (Cambridge, tal. et ora fPolitical of Journal mrcnEcon- American 1970). , (Harmonds- ora of Journal eiwof Review h New The (Oxford: 75(1), , 62, , 37 , , , Downloaded By: [informa internal users] At: 15:43 9 January 2008 hls ..&Zea .(97 h ieaddwwr rn ftentrlrate, natural the of unemployment, trend OECD and downward theory and Natural-rate (1998) rise G. Zoega, The & E.S. (1997) Phelps, G. Zoega, & E.S. Phelps, hls ..&Zea .(01 tutrlbos rdciiyepcain n se valuations, asset and expectations productivity booms: Structural (2001) G. Zoega, & E.S. Phelps, hls ..(07 areooisframdr economy, modern a for Macroeconomics (2007) E.S. Phelps, hls ..&Sel .(99 ulcdb,txto,adcptlintensiveness, capital and taxation, debt, Public (1969) K. Shell, & E.S. Phelps, hls ..&Vlpla,K 18)Otmmficlplc hnmntr oiyi on yarule, a by expec- bound is rational policy monetary under when policy policy fiscal monetary Optimum (1988) of K. Velupillai, powers & E.S. Stabilizing Phelps, (1977) J.B. Taylor, & E.S. Phelps, hls ..(04)Efcso hn’ eetdvlpeto h eto h world, the of rest the on development recent China’s of Effects 1990s the (2004b) of E.S. account causal Phelps, a slump: the and boom The (2004a) E.S. Phelps, (2003b) (Ed.) E.S. II, Phelps, and I Parts on employ- Reflections equity, efficiency, (2003a) to E.S. hazards cuts: Phelps, spending without cuts tax Income (2002b) E.S. Phelps, (1991) (Ed.) E.S. Phelps, hls ..&Rly ..(98 alingot:Dnmcpormigo aia elhfor wealth capital of programming Dynamic growth: Rawlsian (1978) J.G. Riley, & E.S. Phelps, hls ..(2002a) E.S. Phelps, hls ..(92)Arve of review A (1992a) E.S. Phelps, aggrega- dynamic open-economy small a in macropolicies of effectiveness The (1991) E.S. Phelps, hls ..(95)Alf neoois n .Hete(Ed.) Heertje A. in: economics, in life A (1995a) E.S. Phelps, (1994) Zoega G. & Kanaginis, G. Hoon, H.T. with collaboration in E.S., Phelps, hls ..(99)Bhn h tutrlbo:terl fastvaluations, asset of role the boom: structural the Behind (1999b) E.S. Phelps, unem- on wages’ ‘incentive and demand, GDP total productivity, of effects The (1990b) E.S. Phelps, 38 hls ..(99)Mrlhzr n needn noei oenitreprl equilibrium intertemporal- modern a in income independent and hazard Moral (1999a) E.S. Phelps, (1997) in: E.S. unemployment, of Phelps, rate natural the of development further and origins The (1995b) E.S. Phelps, customer-market a in unemployment equilibrium and demand Consumer (1992b) E.S. Phelps, cnmcRve:Ppr n Proceedings and Papers Review: Economic cnmcPlc:AErpa Forum European A Policy: Economic 782–801. pp. 108(448), edb h nentoa cnmcAssociation Economic International the (Eds) by Boskin held M. & Arrow K. in: tations, Theory nHnro dudPhelps (Eds) Edmund Woodford of M. Honor & in Stiglitz J. Frydman, R. growth, and ment, oiyModeling Policy Enterprise Private negnrtoa mxmn justice, ‘maximin’ intergenerational 543–561. pp. dadElgar). Tobin Edward James of (Eds) Honor Watts in H.W. Essays & Policy: Nordhaus Economic W.D. and Brainard, W.C. in: model, tive 1930s, Assets and Interest, Unemployment, of Press). University Theory Harvard Equilibrium Modern The eiw aesadProceedings and Papers Review: economy, open small Economics the of of model Journal customer-market non-monetary a in ployment oe fivlnayuepomn n adtr eieet n .Cihlik (Ed.) Chichilnisky G. in: retirement, mandatory Uncertainty and and Information unemployment Markets, involuntary of model Enterprise Press). University Cambridge UK: (Cambridge, 15–31 pp. Elgar). Edward (Ed.) VT: Cross Brookfield, R. & UK, (Aldershot, 90–113 pp. II, Vol. economy, incentive-wage 1476–1490. pp. ..Dimand R.W. () p 330–346. pp. 1(3), , ora fPlc Reform Policy of Journal ora fPltclEconomy Political of Journal Cmrde A avr nvriyPress). University Harvard MA: (Cambridge, h aua aeo nmlyet eetoso 5Yaso h Hypothesis the of Years 25 on Reflections Unemployment, of Rate Natural The nepieadIcuini Italy in Inclusion and Enterprise eadn ok o oRsoePriiainadSl-upr oFree to Self-Support and Participation Restore to How Work: Rewarding 689,p.903–910. pp. 26(8–9), , ora fPlc Modeling Policy of Journal Cmrde K abig nvriyPress). University Cambridge UK: (Cambridge, 22,p.353–367. pp. 92(2), , eetDvlpet nMacroeconomics in Developments Recent einn nlso:Tost as o-n a n mlyetin Employment and Pay Low-End Raise to Tools Inclusion: Designing urel ora fEconomics of Journal Quarterly p 7–8,5053(rneo,N (Princeton, 550–563 271–281, pp. , () p 3–19. pp. 7(1), , h cnmc fPbi et rceig faConference a of Proceedings Debt: Public of Economics The 92,p.63–68. pp. 89(2), , Unemployment eiwo cnmcStudies Economic of Review 51,p.163–190. pp. 85(1), , 2 p 85–126. pp. 32, , Cmrde K abig nvriyPress). University Cambridge UK: (Cambridge, 72,p.283–289. pp. 87(2), , nweg,Ifrain n xettos Essays Expectations: and Information, Knowledge, 44,p.391–399. pp. 24(4), , eetoso at I n V n .Aghion, P. in: IV, and III Parts on Reflections p 1–3 Lno:Macmillan). (London: 116–130 pp. , , Bso:Kue Academic). Kluwer (Boston: ora fEooi Literature Economic of Journal Cmrde A I Press). 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Romer, enti,MM 18)Rve of Review (1987) M.M. Weinstein, growth, economic of theory the to contribution A (1956) R.M. Solow, macroeconomics, (1947) to P.A. contributions Phelps’s Samuelson, Edmund (2006) Sciences of Academy Swedish Royal . oesn .&Glrih .(97 ypsu:Tentrlrt funemployment, of rate natural The Symposium: (1997) J. Perspectives Galbraith, Economic & of Journal R. Rogerson, L., p 334–361. pp. ora fEooi Perspectives Economic of Journal Statistics Economics Press). University pp. 33 9, October www.kva.se, 9 p 312–320. pp. 39, , 0 p 65–94. pp. 70, , hoyo Justice of Theory A tutrls Macroeconomics Structuralist dacdMacroeconomics Advanced Money h onain fEooi Analysis Economic of Foundations The NwYr:CmrdeUiest Press). University Cambridge York: (New oiia cnm:A nrdcoyText Introductory An Economy: Political dudPep n oenMacroeconomics Modern and Phelps Edmund Cmrde A avr nvriyPress). University Harvard MA: (Cambridge, 11,p.3–108. pp. 11(1), , () p 179–182. pp. 1(2), , NwYr:MGa Hill). McGraw York: (New ora fPltclEconomy Political of Journal NwYr:BscBooks). Basic York: (New ora fPltclEconomy Political of Journal cnmcRecord Economic Cmrde A Harvard MA: (Cambridge, yEmn .Phelps, S. Edmund by , urel ora of Journal Quarterly 32,p.103–115. pp. 63(2), , eiwo Economic of Review 9 p 213–225. pp. 69, , 32(63), , 39