Economist Allan Timmermann: Phillips Curve Data Suggests 2% Fed Inflation Target May Trigger Downturn
In macroeconomics, the Phillips Curve claims an inverse relationship between unemployment and inflation: When inflation increases, unemployment decreases and vice versa. But empirical data doesn't bear it out unless you examine it granularly — as did a recent team that included Allan Timmermann of UC San Diego's Rady School of Management. In a May 2023 working paper, Timmermann and colleagues found that in a hot labor market, such as the one that exists in the US, the... read more »