Read Is There a Stable Phillips Curve After All? article

1. Why did William Phillips postulate an inverse relationship between the unemployment rate and (wage) inflation?

2. The authors claim that national data are unlikely to provide evidence for or against a Phillips Curve. Carefully explain why this is.

3. Carefully explain, using the necessary detail, how the authors use regional data to provide evidence for the existence of a stable Phillips Curve. Why is regional economic data more useful than national economic data?

4. What is the main finding the authors report in this essay? In other words, what is the numerical relationship between the unemployment rate and the inflation rate that they estimate?