Wednesday, July 6, 2011

The Corridor Hypothesis confirmed

n a New York Fed research paper looking at the Phillips effect, the relationship between unemployment and inflation.

Readers might look at the paper, in terms of channel theory we have the natural rate of unemployments when all the -iLog(i) (i finite integer) are within an integer, production then is sustained. Outside that band we have a rank increase, in response to higher profits, and a rank decrease in response to shortages.

Shannon once again rules.

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