Showing posts with label Phillips Curve. Show all posts
Showing posts with label Phillips Curve. Show all posts

Saturday, February 12, 2011

Factor Prices and the Output Gap!


Oh dear god, am I ever behind schedule for these notes...

Okay, today, we're going to have a look at what happens to our economic model when we allow factor prices (this usually refers to wages) to vary. Up until this point, we've been assuming that factor prices remain constant, but in real life, that isn't necessarily the case.

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