Rosengren Sees Wages Rising in Tight Labor Market

The transcript discusses the complexities of inflation dynamics, questioning if there has been a permanent shift. It highlights wage growth and tight labor markets, referencing the Phillips curve model. Alternative explanations for low inflation, such as globalization and structural changes, are considered. The discussion concludes with the expectation that tight labor markets will eventually lead to wage and price increases.

What is the current trend in wages and salaries according to the transcript?

• They are decreasing rapidly.

• They are stagnant.

• They are slowly increasing.

• They are increasing rapidly.

What economic model is mentioned as a belief for understanding wage and price pressures?

• Phillips curve model

• Monetarist model

• Keynesian model

• Supply and demand model

Which factor is NOT mentioned as a possible explanation for low inflation?

• Globalization

• Tight labor markets

• Technological advancements

• Structural changes in the economy

What is expected to happen to prices as labor markets tighten?

• Prices will decrease.

• Prices will remain the same.

• Prices will increase with a lag.

• Prices will fluctuate randomly.

What is the expectation for firms when they face higher wages?

• They will stop hiring.

• They will increase their profit margins.

• They will maintain their profit margins.

• They will reduce their profit margins.