DEFINITION of 'NonAccelerating Inflation Rate Of Unemployment  NAIRU'
The specific level of unemployment that exists in an economy that does not cause inflation to increase. The nonaccelerating rate of unemployment (NAIRU) often represents an equilibrium between the state of the economy and the labor market.
NAIRU is also sometimes referred as a "longrun Phillips curve".
INVESTOPEDIA EXPLAINS 'NonAccelerating Inflation Rate Of Unemployment  NAIRU'
For example, suppose that the unemployment rate is at 5% and the inflation rate is 2%. Assuming that both of these values remain the same for a period of years, it can be said that when unemployment is under 5%, it is natural for an inflation rate of 2% to correspond with it.
Critics cite that it is unlikely to have a static rate of unemployment that will last for long periods of time, because different levels of factors affecting the workforce and employers (such as the presence of unions and monopolies) can quickly shift this equilibrium.

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