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Evolving dynamics of the relationship between US core inflation and unemployment

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  • Putnam, Bluford H.
  • Azzarello, Samantha

Abstract

Labor market dynamics in the US are changing due to long-term factors including decelerating labor force growth, rising age of the labor force, and the rapid advance of e-commerce, as well as the one-time downward adjustment during 2009–2013 of the size of state and local government work forces. We discuss some of the controversies revolving around how to analyze labor markets in this dynamic environment from the perspective of monetary policymaking, given the dual mandate of the Federal Reserve to encourage both full employment and price stability.

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  • Putnam, Bluford H. & Azzarello, Samantha, 2015. "Evolving dynamics of the relationship between US core inflation and unemployment," Review of Financial Economics, Elsevier, vol. 25(C), pages 27-34.
    • Handle: RePEc:eee:revfin:v:25:y:2015:i:c:p:27-34
    DOI: 10.1016/j.rfe.2015.02.002
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    More about this item

    Keywords

    Dual mandate; Federal Reserve; Inflation; Employment; Unemployment;
    All these keywords.

    JEL classification:

    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination

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