A Short Review of Edmund Pheleps Achievements

Since 1960s, Edmund pheleps’ contribution to macroeconomics has made great impact on the dominant views in this field. His effort culminated to his Nobel Prize in Economics in 2006. This article reviews his main contributions in two sections. First, relationship between unemployment and inflation and his contribution to rectify Philips Cruve is Considered. His main finding in this relation is that the long run unemployment rate is not affected by monetary and fiscal policies. His analysis revealed the main limitations of demand management approach. The second section deals with Pheleps’ work in capital accumulation and its Golden rule. It is shown that there is a rule of thumlo indicates that in the long run, savings rate should be equal to the capital share in national income. He introduces a condition in which all gaverations are beneficiaries of chnges in Saving rates. Moreover, he analysed the role of human capital in economic growth by arguing that an educated, well-trained workforce is better equipped to adopt new technologies.