stylistic:style_transfer, linguistic:paraphrasing
Stagflation

In the 1970s, many countries experienced high levels of both inflation and unemployment also known as stagflation. Theories based on the Phillips curve suggested that this would not occur, and the curve came under attack from a group of economists headed by Milton Friedman. Friedman argued that the Phillips curve relationship was only a short-run phenomenon. This followed eight years after Samuelson and Solow wrote "All of our discussion has been phrased in short-run terms, dealing with what might happen in the next few years. It would be wrong, though, to think that our Figure 2 menu that related obtainable price and unemployment behavior will maintain its same shape in the longer run. What we do in a policy way during the next few years might cause it to shift in a definite way." As Samuelson and Solow had argued 8 years earlier, Friedman said that in the long run, workers and employers will take inflation into account, resulting in employment contracts that increase pay at rates near anticipated inflation. Unemployment would then begin to rise back to its previous level, but with higher inflation. This implies that over the longer-run there is no trade-off between inflation and unemployment. This is significant because it implies that central banks should not set unemployment targets below the natural rate.