The Phillips curve: Unemployment and the change in inflation e We derived in chapter 10 the following relation (11.4) If expected inflation be well approximated by last year's inflation, so that we can replace s t by J 1 then it should hold J4—兀 (11.5) 2003-7-28 72003-7-28 7 The Phillips curve:Unemployment and the change in inflation We derived in chapter 10 the following relation: πt -πt e = -α(ut - un ) (11.4) If expected inflation be well approximated by last year’s inflation, so that we can replace πt e by πt-1 , then it should hold: πt -πt-1 = -α(ut - un ) (11.5)