Answer: The Phillips curve is a model that stated a stable negative relationship between inflation and unemployment.
Explanation:
Up to the late 1960s, it was used to predict inflation and unemployment rates.
Milton Friedman and Edmund Phelps affirmed that this model could only apply in the short run, while in the long run, inflation expectations would make people anticipate a higher level of inflation, leading the economy to the natural level of unemployment for a higher level of inflation.
Furthermore, from the 1970s and onward, inflation and unemployment rates deviated from the predictions, as the relationship between those variables became unstable.
