Journal Article
Increasing Returns to Scale and the Long-Run Phillips Curve
Economics Letters
Authors
Publication Date
JEL Classification
E3
E20
E40
E50
Key Words
A growing body of empirical evidence shows that there exists a long-run positive tradeoff between inflation and real macroeconomic activity. Within a New Keynesian framewok, we examine how increasing returns generate a positive long-run relation between inflation and output.
