Suppose policy makers accept the theory of the short run Phillips curve and the natural-rate hypothesis and

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Suppose policy makers accept the theory of the short run Phillips curve and the natural-rate hypothesis and want to keep unemployment close to its natural rate.

Unfortunately, because the natural rate of unemployment can change over time, they aren’t certain about the value of the natural rate. What macroeconomic variables do you think they should look at when conducting monetary policy?

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Economics

ISBN: 124344

2nd Edition

Authors: N. Gregory Mankiw

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