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Edmund Phelps's Contributions to Macroeconomics

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Abstract

Advanced information on Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2006. The relationship between inflation and unemployment and the trade-off between the welfare of current and future generations are key issues in macroeconomic research. They have a strong influence on the choice of macroeconomic policy. Both issues concern trade-offs between different objectives. How should fiscal and monetary policy resolve the conflict between the goals of low inflation and low unemployment? How should society trade off consumption today against consumption in the future, i.e., how much should be saved in order to increase future consumption? Edmund Phelps has made major contributions to the analysis of both of these trade-offs. In particular, he had the insight that also the balance between inflation and unemployment reflects a fundamentally inter-temporal problem.

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  • Committee, Nobel Prize, 2006. "Edmund Phelps's Contributions to Macroeconomics," Nobel Prize in Economics documents 2006-1, Nobel Prize Committee.
    • Handle: RePEc:ris:nobelp:2006_001
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    More about this item

    Keywords

    inter-temporal; inflation unemployment trade-off;

    JEL classification:

    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General

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