At the outbreak of
World War II, Phillips joined the
Royal Air Force and was sent to Singapore. When Singapore fell, he escaped on the troopship
Empire State, which came under attack before safely arriving in
Java. During the attack, Phillips improvised a machine gun mounting which allowed him to fire at the enemy.
Laurens van der Post, who was in captivity with Phillips, described him as "one of the most singularly contained people I knew, quiet, true and without any trace of exhibitionism". In 1946, he was made a Member of the
Order of the British Empire (MBE) for his war service, in particular for his development of a system that allowed
Brewster Buffalo fighter planes to fire through the propeller. == Economics career == After the war Phillips moved to London and began studying
sociology at the
London School of Economics (LSE), because of his fascination with prisoners of war's ability to organize themselves. But he became bored with sociology and developed an interest in
Keynesian theory, so he switched his course to economics and within eleven years was a professor of economics.
MONIAC While a student at the LSE Phillips used his training as an engineer to develop
MONIAC (‘Monetary National Income Analogue Computer’), an
analogue computer which used
hydraulics to model the workings of the British economy, inspiring the term
hydraulic macroeconomics. It was very well received and Phillips was soon offered a teaching position at the LSE. He advanced from assistant lecturer in 1951 to professor in 1958.
Phillips curve While at LSE, Phillips' work focused on British data and observed that in years when the
unemployment rate was high, the rate of growth of nominal wages tended to be stable, or possibly fall. Conversely, when unemployment was low, wages rose rapidly. This sort of pattern had been noticed earlier by
Irving Fisher, but, based on Phillip's intuition that “[w]hen the demand for labour is high and there are very few unemployed we should expect employers to bid wages rates up quite rapidly” and that firms would put up prices as a result, he published his own paper in 1958 on the relationship between inflation and unemployment, The Phillips curve can be written of terms of rate of growth of prices and unemployment. It was subject to the study of several Keynesian and neoclassical economists, especially in the context of the monetarist model by Milton Friedman and the new neoclassical macroeconomics by Robert Lucas. Several studies around the Phillips curve tried to understand whether it is possible or not for policy makers to exploit the Phillips curve, that is to accept a lower level of employment, and so an higher level of unemployment, in exchange of inflation stabilisation. Nowadays there is still debate around this concept. Soon after the publication of Phillips' paper, the idea that there was a trade-off between a strong economy and low inflation caught the imagination of academic economists and policy-makers alike.
Paul Samuelson and
Robert Solow wrote an influential article describing the possibilities suggested by the Phillips curve in the context of the United States. What people think of as the Phillips curve has changed substantially over time, but remains an important feature of
macroeconomic analysis of economic fluctuations, with his paper on wage inflation and unemployment becoming the most cited macroeconomics title of the 20th Century. for 2 years, at the
University of Auckland. He died in Auckland on 4 March 1975. ==References==