Natural rate of unemployment
What Natural rate of unemployment means in Economics A-Level, as defined for AQA.
Definitions of Natural rate of unemployment
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Reference: AQA
The rate at which the long-run Phillips curve is vertical, and below which demand management cannot permanently reduce unemployment.
The unemployment rate existing when the labour market is in equilibrium and the economy produces at its full employment output.
The rate that exists when the labour market is in equilibrium, comprising structural and frictional unemployment.
Topics that use Natural rate of unemployment
- Employment and unemployment (AQA A-Level)
- Possible conflicts between macroeconomic policy objectives (AQA A-Level)
- Supply-side policies (AQA A-Level)
Related terms
- Supply-side policies
- Cyclical unemployment
- Long-run aggregate supply
- Long-run Phillips curve
- Macroeconomic objectives
- Negative output gap
- Capital investment
- Causes of unemployment
Using Natural rate of unemployment in the exam
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