Behind The Markets Podcast: James Bullard
Behind the Markets Podcast
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Is the Phillips Curve Resurrected by Jay Powell?
The hot labor market is actually causing a substitution of capital for labor. There are lots of reasons to think that you might see higher productivity going forward, but you're certainly not seeing it so far this year. I would think it will occur more on the product side of the market where businesses worry that if they raise prices too aggressively, they will lose market share. And so there'll be a race to be the low cost provider and the firm that can provide the good or service without increasing their prices nearly as much.
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