What is the Phillips curve used for?

The Phillips curve remains the primary framework for understanding and forecasting inflation used in central banks. Many economists believe that the Phillips curve is a very useful relationship because both inflation and unemployment are key measures of economic performance. You can read about the Inflation in Economy- Types of Inflation, Inflation Remedies [UPSC Notes] in the given link.

The Phillips Curve is a tool the Fed uses to forecast what will happen to inflation when the unemployment rate falls

Further readings:

  1. Inflation Targeting: Methods, Drawbacks and Benefits
  2. Indian Economy Notes For UPSC Exam [Download PDFs]

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