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Unemployment and Inflation ,[object Object],© 2006 Thomson/South-Western
Costs of Unemployment ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Measuring Unemployment ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Measuring Unemployment ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Exhibit 1:  The Adult Population Sums the Employed, the Unemployed, and Those Not in the Labor Force
Labor Force Participation Rate ,[object Object],[object Object],[object Object],[object Object]
Trend of Unemployment Rate ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Exhibit 2:  The U.S. Unemployment Rate Since 1900
Exhibit 3:  Unemployment Rates for Various Groups
Exhibit 3:  Unemployment Rates for Various Groups
Exhibit 4:  Unemployment Rates Differ Across U.S. Metropolitan Areas
Sources of Unemployment ,[object Object],[object Object],[object Object],[object Object]
Frictional Unemployment ,[object Object],[object Object],[object Object],[object Object]
Seasonal Unemployment ,[object Object],[object Object]
Structural Unemployment ,[object Object],[object Object],[object Object],[object Object]
Cyclical Unemployment ,[object Object],[object Object],[object Object]
Full Employment ,[object Object],[object Object],[object Object],[object Object],[object Object]
Unemployment Compensation ,[object Object],[object Object],[object Object],[object Object],[object Object]
International Comparisons ,[object Object],[object Object],[object Object],[object Object]
Exhibit 5:  In the Last Two Decades, Unemployment Rates Fell in the United States, Rose in Japan, and Remained High in Europe
Problems with Unemployment Figures ,[object Object],[object Object],[object Object],[object Object]
Problems with Unemployment Figures ,[object Object],[object Object],[object Object],[object Object],[object Object]
Inflation ,[object Object],[object Object],[object Object],[object Object]
Inflation ,[object Object],[object Object],[object Object],[object Object],[object Object]
Exhibit 6a: Inflation Caused by Shifts of AD and AS Curves Increase in the AD curve   pulls up  the price level.  To generate continuous demand-pull inflation, the AD curve must keep shifting outward along a given AS curve Increase in costs of production  push up  the price level.  To generate continuous cost-push inflation, the AS curve must  keep shifting to the left along a given AD curve.
Exhibit 7a:  Consumer Price Index Since 1913
Exhibit 7b:  CPI Since 1913 – Annual Percentage Change
Anticipated versus Unanticipated Inflation   ,[object Object],[object Object],[object Object],[object Object],[object Object]
Transaction Costs of Inflation ,[object Object],[object Object],[object Object]
Obscures Relative Price Changes ,[object Object],[object Object],[object Object]
Inflation Across Metropolitan Areas ,[object Object],[object Object]
Exhibit 8:  Average Annual Inflation from 1994 to 2004 Differed Across U.S. Metropolitan Areas
Inflation Across Countries Exhibit 9:  Inflation Rates in Major Economies Have Trended Lower Over the Past Two Decades
Inflation and Interest Rates ,[object Object],[object Object]
Exhibit 10: The Market for Loanable Funds ,[object Object],[object Object],[object Object]
Interest Rates ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Interest Rates ,[object Object],[object Object],[object Object],[object Object],[object Object]
Interest Rates ,[object Object],[object Object]
Why is Inflation Unpopular? ,[object Object],[object Object],[object Object],[object Object],[object Object]
COLA ,[object Object]

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Unemployment And Inflation

  • 1.
  • 2.
  • 3.
  • 4.
  • 5. Exhibit 1: The Adult Population Sums the Employed, the Unemployed, and Those Not in the Labor Force
  • 6.
  • 7.
  • 8. Exhibit 2: The U.S. Unemployment Rate Since 1900
  • 9. Exhibit 3: Unemployment Rates for Various Groups
  • 10. Exhibit 3: Unemployment Rates for Various Groups
  • 11. Exhibit 4: Unemployment Rates Differ Across U.S. Metropolitan Areas
  • 12.
  • 13.
  • 14.
  • 15.
  • 16.
  • 17.
  • 18.
  • 19.
  • 20. Exhibit 5: In the Last Two Decades, Unemployment Rates Fell in the United States, Rose in Japan, and Remained High in Europe
  • 21.
  • 22.
  • 23.
  • 24.
  • 25. Exhibit 6a: Inflation Caused by Shifts of AD and AS Curves Increase in the AD curve pulls up the price level. To generate continuous demand-pull inflation, the AD curve must keep shifting outward along a given AS curve Increase in costs of production push up the price level. To generate continuous cost-push inflation, the AS curve must keep shifting to the left along a given AD curve.
  • 26. Exhibit 7a: Consumer Price Index Since 1913
  • 27. Exhibit 7b: CPI Since 1913 – Annual Percentage Change
  • 28.
  • 29.
  • 30.
  • 31.
  • 32. Exhibit 8: Average Annual Inflation from 1994 to 2004 Differed Across U.S. Metropolitan Areas
  • 33. Inflation Across Countries Exhibit 9: Inflation Rates in Major Economies Have Trended Lower Over the Past Two Decades
  • 34.
  • 35.
  • 36.
  • 37.
  • 38.
  • 39.
  • 40.