Economics Department

Phillips Curve

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All 20 marks

1)      There is no long run relationship between inflation and unemployment. Discuss.

2)      Any attempt to reduce unemployment through an increase in aggregate demand must lead to an increase in inflation in the long run, and is therefore undesirable. Discuss.

3)      Evaluate the significance of the NAIRU to UK macroeconomic policy.

4)      Discuss how stable the NAIRU is in the light of UK economic experience.

5)      "Phillips and Keynes between them are to blame for the economic disasters befalling the UK between 1970 and 1992. To what extent do you agree with this assertion?