March 25, 2013 · 7:30 PM
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Keynesian theory predicts that unemployment has an inverse relationship to inflation. It is unable to explain "stagflation", or the simultaneous existence of high unemployment and high inflation, as was seen during my elementary school years. Lew Rockwell penned a critique of Keynesianism in this week's short reading assignment. Much of this discussion begs questions on how employment and inflation are measured, so I've added an additional link on this topic (and on how these measures have been "tweaked" for political reasons.