The L-shaped aggregate supply curve and the future of macroeconomics
AbstractThe idea of the 'L-shaped aggregate supply curve', supposedly a feature of primitive macroeconomic models, is in fact a reasonable reconstruction of a well developed way of thinking that specifically denied a relation between wage change and aggregate employment.� Neither that approach nor the idea of cost-push inflation to which it is related need be crude or superficial.� Although the ideas in question were swept away by the Phillips curve, they have much merit and their reintroduction to mainstream macroeconomics might pay large dividends.
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Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 486.
Date of creation: 01 May 2010
Date of revision:
Phillips curve; Wage determination; Keynesianism;
Find related papers by JEL classification:
- B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
- E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
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- NEP-ALL-2010-05-29 (All new papers)
- NEP-CBA-2010-05-29 (Central Banking)
- NEP-ENE-2010-05-29 (Energy Economics)
- NEP-ENV-2010-05-29 (Environmental Economics)
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