We can quantify this latter consideration using the so-called sacrifice ratio – the number of years that unemployment has to be 1.0 percentage point greater than its natural rate to reduce the inflation rate 1.0 percentage point.
The first has to do with infrastructure, and there are really two sides to that - human and physical. In terms of human infrastructure, there is a crucial role for government in promoting education and training. Ultimately, the strength of our economy depends on the skills of its workforce.