- In a famous article on ‘The Relation Between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1861-1957’, published in the journal Economica (1958), the economist A. W. Phillips argued that an inverse relationship existed between unemployment and wage inflation in the UK throughout the period in question. The rate of change in money wages tended to be high in conditions of low unemployment and low (or even negative) when unemployment was high. Thus, the so-called Phillips curve suggested that maintenance of full employment would necessarily involve some inflation, whereas inflation was only likely to be reduced by an increase in unemployment. This belief informed much economic discussion, and formed part of the accepted wisdom that provided the backdrop to policy-making throughout the two decades that followed, since it suggested that it was possible to calculate the terms of the trade-off between the policy objectives of full employment and zero inflation. However, the statistical association at the core of the argument clearly broke down (in Britain and elsewhere) during the 1970s, and its interpretation was challenged by the rise of monetarist explanations of inflation and unemployment.
Dictionary of sociology. 2013.
Look at other dictionaries:
Phillips curve — [fil′ips] n. [also P C ] a curve illustrating a theoretical inverse relationship between rates of unemployment and of inflation * * * Graphic representation of the inverse relationship between the rate of unemployment and the rate of change in… … Universalium
Phillips curve — [fil′ips] n. [also P C ] a curve illustrating a theoretical inverse relationship between rates of unemployment and of inflation … English World dictionary
Phillips curve — The Phillips curve is a historical inverse relation between the rate of unemployment and the rate of inflation in an economy. Stated simply, the lower the unemployment in an economy, the higher the rate of increase in wages paid to labor in that… … Wikipedia
Phillips Curve — An economic concept developed by A. W. Phillips stating that inflation and unemployment have a stable and inverse relationship. According to the Phillips curve, the lower an economy s rate of unemployment, the more rapidly wages paid to labor… … Investment dictionary
Phillips Curve — A graph that supposedly shows the relationship between inflation and unemployment . It is conjectured that there is a simple trade off between inflation and unemployment (high inflation and low unemployment, and low inflation and high… … Financial and business terms
Phillips curve — noun Economics a supposed inverse relationship between the level of unemployment and the rate of inflation. Origin 1960s: named after the New Zealand economist Alban W. H. Phillips … English new terms dictionary
phillips curve — ¦filə̇ps noun Usage: usually capitalized P Etymology: after A.W.H. Phillips died 1975 British (New Zealand born) economist : a graphic representation of the relation between inflation and unemployment which indicates that as the rate of either… … Useful english dictionary
Phillips curve — In economics, a measure showing the relationship between inﬂation and unemployment … Bryson’s dictionary for writers and editors
Phillips curve — graph illustrating the level of inflation as a function of the level of unemployment (Economics) … English contemporary dictionary
phillips curve — Graph of the relationship between inflation and unemployment in an economy … American business jargon