Input (grade 13): Phelps, with Calvo and John Taylor, started a program to rebuild Keynesian economics with rational expectations by employing sticky wages and prices.
Output (grade 12): In the next years, Keynesian economics were thought of as less important after the publication of John Muth's work called rational expectations. Phelps, with Calvo and John Taylor, started a program to rebuild Keynesian economics with new ideas about prices and wages being kept the same for certain time.