Abstract:

The paper deals with two basic economic indicators of economic policy: inflation and unemployment. These economic indicators represent a very serious problem in every market economy, as they have a negative impact on economic growth. Unemployment represents the excess of labour supply over demand. We talk about inflation when there is an increase in the price level. The paper deals with the investigation of relations between unemployment and inflation, known as the Phillips curve, in the Slovak Republic on the basis of statistical data from 1993 to 2014. The aim of this paper is to prove or disprove the hypothesis on an inverse relationship between the rate of inflation and unemployment in the said country.