I have plotted the annual inflation (CPI-U) vs unemployment. The green line represents the time William Martin was the Fed Chairman (April 2, 1951 – February 1, 1970). The gray line represent the years 1948-2007.
In traditional economic theory, the Phillips curve describes the inverse relationship between inflation and unemployment, i.e. when inflation is high, unemployment is low. This was true in the United States in the 60s but not other time periods
{Click on the image to take a closer look}
Data from Bureau of Labor Statistics
Technorati Tags: United States, Inflation, Unemployment
Related Posts:
Popularity: 2% [?]
Get the latest graphs and maps sent to you automatically!
Subscribe to my RSS feed or sign up for updates by email.
View
Catherine,
I’ve looked at these and like the way you laid these out. But to me, it points out that without examining the dynamics happening in the money supply at a given time, the analysis is incomplete.
It would be really interesting to juxtapose money supply into this graph, turning it into a 3-D surface. Or at the very least, show time along the x-axis, inflation on the y, and unemployment on the z. Still the idea of visualizing these concepts in a 3-D construct has a lot of “intuitive appeal.”
Cheers,
Tony