A Phillips Curve Study Of Positive Slopes In The Case Of "stagflation"

The proposition.revision and development of Phillips curve run throughout the reality of western countries' economic development.After the Great Depression of the 1930s.the Keynesian theory dominated the logic of Western economic policy.The data of economic operation also showed the Phillips curve's form which is the inverse relationship between inflation rate and unemployment rate.Based on this,policy makers could make their choice between high inflation and high unemployment in the short run.However,after perfect economic regulation for quite a while,the economic data of the 1970s negated the relationship between unemployment and inflation described by Phillips previously.Keynesian theory could not account for the phenomenon convincingly,and didn't present specific measures of solving the"stagflation",which became breakthrough point where the liberal school criticized the Keynesian theory.Friedman who is Monetarism's representative personage extended Phillips curve on the basis of Natural-rate hypothesis,considering that its evolution may be divided into three stages,and came up with the Phillips curve of positive slope,which reflects that relationship of inflation rate and unemployment rate is positive correlation in the last ten years from 1966 on the basis of the empirical data of seven industrialized countries' the rate of inflation and unemployment.At the same time.some other schools' economics also analyzed the causes of stagflation from different perspectives according to their own theories.Based on the "stagflation" theory of the major schools,this paper makes a theoretical derivation for the "stagflation" Phillips curve of positive slope by using the mainstream macroeconomic model,and interprets the economic meaning of the expression of the positive slope's Phillips curve,combining the economic policy that developed countries used in solving"stagflation "and cause with which emerging economies take place it in recent years,and extracts core policy by which we can deal with and prevent "stagflation" and reference significance for our country.