Breitbart Business Digest: When a Productivity Boom Meets a Tight Labor Market

Edmund Phelps: The Prophet of Productivity Booms and Busts

Edmund Phelps, who died last week at 92, won the Nobel Prize in Economics back in 2006 for his work on the deep structure of unemployment, inflation, and expectations. But one of his most provocative ideas—the productivity business cycle—has still not received the attention it deserves.

That’s a shame because Phelps ideas are exactly what we should be paying attention to right now.

American economist and the winner of the 2006 Nobel Memorial Prize in Economic Sciences, Edmund Phelps, at a conference at the Ministry of Economy in Paris on November 21, 2017. (ERIC PIERMONT/AFP via Getty Images)

The U.S. economy has come to an unusual crossroads. Productivity is accelerating, the labor market remains historically tight, and workforce growth has stalled. Conventional wisdom treats the tight labor market and stalled workforce growth as warning signs that growth could be hampered.