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Unemployment only differs from its natural rate if expected inflation is different from actual inflation - why?

Mankiw probably refers there to the Expectations Augmented Philips Curve (EAPC) or some related model. According to EAPC the following relationship holds (See Romer Advanced Macro pp 259-262): $$ \...
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How can employment be up but production is down?

Unemployment is the wrong measure to look at. At least in the US, a lot of people have left the labor force altogether. As a result, the unemployment rate is very low as most people who are willing to ...
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How can employment be up but production is down?

You make several general claims that may or may not be true. Even if they are, there seems to be no logical contradiction. There is definite scarcity. ...of what? 2. Production of practically every ...
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