Phillips curve
Finally, the NAIRU theory says that the inflation rate does not rise or fall when the unemployment equals the "natural" rate. This is where the term NAIRU is derived. In macroeconomics, the case where the actual unemployment rate equals the NAIRU is seen as the long-run equilibrium because there are no forces inside the normal workings of the economy that cause the inflation rate to rise or fall. The NAIRU corresponds to the "long-run Phillips curve". While the short-run Phillips curve is based on a constant rate of inflationary expectations, the long-run Phillips curve reflects full adjustment of inflationary expectations to the actual experience of inflation in the economy.