Maddin

I'll just say that the Schweser explanation is not exactly the best one around. My personal opinion is that the Philips curve is derived with shifts in the AD curve, which causes changes in equlibrium along the AS curve.

The TB seems to agree with me. pg 393 Vol 2 clearly states that "a movement ALONG the SAS curve that brings a higher price level and an increase in real GDP is equivalent to a movement along the short run Philips curve from A to B that brings an increase in the inflation rate and a decrease in the unemployment rate."

AkshayJ I suggest you read it from the TB, which I think does confirm what you are trying to say. Are you an econ major?