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nairu
[ney-roo]
noun
nonaccelerating inflation rate of unemployment: the lowest level of unemployment an economy can handle without causing inflation.
NAIRU
/ ˈԲɪː /
acronym
Also called: natural rate of unemployment.non-accelerating inflation rate of unemployment: the rate of unemployment at which inflation is neither accelerating nor decelerating
Word History and Origins
Origin of nairu1
Example Sentences
If the jobless rate falls below NAIRU, the labor market gets too hot and inflation accelerates.
If it rises above NAIRU, the labor market cools down and inflation decelerates.
You might notice that both of these concepts—NAIRU and the sacrifice ratio—involve the labor market.
Or, to put it another way: He thinks the problem is that the jobless rate is way below NAIRU.
This is theoretical concept is known as the NAIRU—or the non-accelerating inflation rate of unemployment, if you don’t mind a mouthful.
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