The conversation between human and AI assistant.
What is the relationship between growth, inflation and unemployment?
That makes sense. What about the relationship between inflation and unemployment?
The relationship between inflation and unemployment is often described by the Phillips curve. The curve suggests that there is an inverse relationship between inflation and unemployment. When the unemployment rate is low, there is usually more competition for workers, which can drive up wages and increase production costs. This in turn can lead to higher prices and inflation. On the other hand, when unemployment is high, there is less demand for goods and services, which can lead to lower prices and lower inflation.