Abstract
Since PHILLIPS (1958) wrote his landmark article on the relationship between money wage rates and unemployment, much work has been conducted concerning ‘Phillips’ curves'. While some writers, such as LIPSEY (1960), SAMUELSON and SOLOW (1960) and HANSEN (1970), remained relatively close to Phillips' original model, other strayed from it. BRECHLING (1968), DICKS-MIREAUX and DOW (1959), ECKSTEIN (1968), ECKSTEIN and WILSON (1962), HAMERMESH (1970), KUH (1967), PERRY (1966), PHELPS (1968), and TAYLOR (1970) are a few researchers who felt Phillips' formulation did not adequately explain changes in money wage rates. Their approaches ranged from formulating entirely new models to merely adding other explanatory variables to Phillips' model. The present study estimates a Phillips' curve for the United Kingdom within the framework of Phillips' basic hypothesis. He grouped all observations according to unemployment levels, averaged the wage changes for each group, and fitted a curve by trial and error to the compac...
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