Firedman’s Phillips Curve Research

Friedman in the nineteen seventies “stagflation” period, put forward the “natural rate ofunemployment” and “adaptive expectations Phillips Curve”, successfully explains the“stagflation”, denied the substitution relationship between inflation and unemploymentKeynes identified the trate-off, put forward “additional expected Phillips Curve” with“natural rate of unemployment” and “adaptive expectations”, come to a decision theshort-term economic policy valid and long-term economic policy invalid. Friedman predictedthat capitalist economic development, reduce government intervention, let the marketlaissze-faire, form the market adjust itself. Friedman’s Phillips Curve main policy argument:the single rule to money supply as the intermediate target of monetary policy and advocate offree market mechanism and limited government. The article explains the basis of liberaleconomic philosophy foundation and the method of the Phillips Curve from Friedman’s owneconomic philosophy, provide the basic logic and philosophy on the basis of strict Friedman ’sPhillips Curve.At the beginning of the late70’s, all capitalist countries began to accept Friedman’spolicies, the economic theory of Friedman’s policies becoomes the government economics asgovernment behavior criterion. Mrs.Thatcher fulfilled the British Friedman’s policies, throughcontrolling inflation and reducing state intervention, to encourage private enterprises to active,made a success in the UK, but also showed its theory limitations. Finally, combining thenational conditions of our country, on the basis of choice of Chinese ploicy to analyseFriedman’s Phillips Curve in the adaptability and limitation of Chinese practiceThe first part of this paper is the introduction introduces the research background, atHome and Abroad, research idaeas and frameworks and innovation. The second part describesthe reinterpretation of Friedman’s Phillips Curve. The third part of the analysis of theeconomic and philosophical basis of Friedman’s Phillips Curve. The fourth part descrebesFriedman’s Phillips Curve theory policy practice in the UK. Part V combined with Chinesenational condition, adaptability and limitations of the Phillips Curve of Friedman’s practicein China.