An Empirical Analysis Of The Relationship Between Inflation And Unemployment In Different Levels Of Economic Development In China

Inlfation and unemployment are two important indexes to measure actualeconomic operation in a country,and also are important objectives ofmacroeconomic policy.As the classical theories show, Phillips Curve provides auseful and intuitive tool for us to study the problem of unemployment andinflation.Since it appears,Phillips Curve has experienced different kinds oftransformations with the development of macroeconomics, and has become animportant policy tool‘However,The Phillips Curve has been an major issueamong economic scholars.China is experiencing the severe problem ofinflation and unemployment,The research is done district by district accordingto the regional economic difference, so as to evaluate whether Phillips Curve inChina exists and what the most likely forms are.Meanwhile this paper tries toexplain inflation based on statistic research of Phillips Curve in China. Atlast,This paper presents some suggestions about relevant policies.This paper consists of four parts.The forward part presents the issue whichis to discuss.and some popular views of relation between inflation andunemployment.The first patr mainly introduces the Phillips Curve theory andopinions of the different schools.The second part explains how to measureinflation and unemployment and the indexes in this paper. Then our country isdivided into four different levels according to the economic difference.Somerepresentative districts are chosen to be specifically researched in every level Atthe end，this part explains two forms of Phillips Curve in the research. The thirdpart is to do statistic research on Phillips Curve between different districts in China, and compared with the other districts whether in the same level ordifferent levels. Besides, several variables are taken into the regression in orderto better explain inflation.At the end of this part,the result is givembecause theunemployment data is not perfect,the inflation-unemployment Phillips Curve isdififcult to evaluate, but the inflation-output gap Phillips Curves do exist inmost of our districts.The fourth part explains the economic difference betweendistricts in China, further summarizes the result of the statistic part.thenanalyses the problem of inflation and unemployment,and provide the policiesaccordingly.