Due to a "baby bust" in the 1960s and 1970s, fewer people entered the labour market in the 1980s and 1990s. This demographic event ________ the natural unemployment rate thereby shifting the short-run Phillips curve ________ and shifting the long-run Phillips curve ________.

Question

Quizplus · Accepted Answer

A baby bust leads to fewer people entering the labor market, which decreases the natural unemployment rate. This shifts the short-run Phillips curve leftward and the long-run Phillips curve leftward as well.

Due to a "Baby Bust" in the 1960s and 1970s