NAIRU

Noun

Meaning

NAIRU

(economics) Initialism of non-accelerating inflation rate of unemployment.

Anagrams

Examples

But the NAIRU theory says that this is not the whole story, so that the trade-off breaks down: a persistently higher inflation rate is eventually incorporated as higher inflationary expectations. Source: Internet

As mentioned above, Abba Lerner had developed a version of the NAIRU before the modern "natural" rate or NAIRU theories were developed. Source: Internet

Again start with the unemployment rate equal to the NAIRU. Source: Internet

Finally, the NAIRU theory says that the inflation rate does not rise or fall when the unemployment equals the "natural" rate. Source: Internet

In macroeconomics, the case where the actual unemployment rate equals the NAIRU is seen as the long-run equilibrium because there are no forces inside the normal workings of the economy that cause the inflation rate to rise or fall. Source: Internet

One of the major problems with the NAIRU theory is that no one knows exactly what the NAIRU is (while it clearly changes over time). Source: Internet

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