The article introduces a new way to understand why prices and wages change over time. It suggests that firms and workers can't adjust prices and wages as much as they want due to costs. By looking at how prices and wages change, the researchers found that their new model better explains how inflation and real output are connected. They also discovered that changes in inflation expectations and past inflation play a role in how inflation behaves. The findings show that inflation in the 1970s was influenced by expectations, while inflation in the 1960s was linked to past inflation rates.