Phillips Curve

When $P\uparrow$ is anticipated then $u$ is unchanged

When there is unanticipated $P\uparrow$, $u\downarrow$ relative to $\bar{u}$

PC EQUATION: $\pi ={\pi }^e-h(u-\bar{u}$)

Shifts come from changes in ${\pi }^e\text{ or }\bar{u}$

$\bar{u}\uparrow ⟹$ PC shifts right

${\pi }^e\uparrow ⟹$ PC shifts right

Essentially impossible to exploit PC for policymaking