September 9, 2015

Like an ant on the Möbius strip

Comment on ‘The Fed Must Banish the 1970’s Inflation Devil’


The question is about the relationship between average price, employment, average wage rate, average productivity, total demand and quantity of money. This relationship has been discussed extensively in the 70s under the heading Phillips curve but never solved.

The testable relationship between the aforesaid variables is given here. The theoretical underpinning is given here (2012; 2014). The two working papers make it also understandable why the representative economist cannot do other but senselessly repeating his well-trodden path on the Econ 101 Möbius strip. Better the Fed banishes this guy first.

Egmont Kakarot-Handtke

Kakarot-Handtke, E. (2012). Keynes’s Employment Function and the Gratuitous Phillips Curve Disaster. SSRN Working Paper Series, 2130421: 1–19. URL
Kakarot-Handtke, E. (2014). The Three Fatal Mistakes of Yesterday Economics: Profit, I=S, Employment. SSRN Working Paper Series, 2489792: 1–13. URL