Question

Would you expect to see long-run data trace out a stable downward-sloping Phillips curve?

Short answer

The long-run Phillips Curve is descending inclining as a result of the compromise between inflation and joblessness.

Step-by-step solution

Definition of Philip curve

The Phillips Curve is the explanation that there is a connection amongst a business and inflation. The degree of relationship modifies over the long run. However, that doesn't reach out to causation.

Explanation

No, the Phillips curve does exist but generally over periods of times no more than 10 years. A downward-sloping Phillips curve should be analyzed as valid for a short-run duration of several years, but over longer spans—when total supply changes—the downward-sloping Phillips curve can move so that unemployment and inflation are both higher.