This is because the total supply curve reveals the relationship between total output and price level. When the actual total output exceeds the potential total output level, the price begins to rise. When the actual total output is lower than the potential total output, the price begins to fall. This relationship is the same as that described by Phillips curve, because Phillips curve describes the relationship between inflation and unemployment rate, that is, when the inflation rate is high, the unemployment rate is often low; On the contrary, when the inflation rate is low, the unemployment rate is high. The unemployment rate actually reflects the utilization of economic resources in the economy (tight or underutilized). In addition, the level of unemployment reflects the question whether the actual total output is greater than or less than the potential total output, that is,

Therefore, although the relationship between Phillips curve and total supply curve is different on the surface, they essentially express the same macroeconomic thought, just two sides of the same coin.

Monetarists believe that in wage negotiations, workers care about real wages rather than monetary wages. When inflation is not too high and workers do not form new inflation expectations, the substitution relationship between unemployment and inflation is called short-term Phillips curve. As time goes by, workers find that their real wages are falling with the increase of prices, and they will ask their employers to increase their monetary wages accordingly to make up for the losses caused by inflation. As workers constantly form new inflation expectations, the inflation rate in exchange for a certain unemployment rate is getting higher and higher, and a series of Phillips curves constantly move to the upper right, and finally evolve into a vertical Phillips curve, which is the long-term Phillips curve. The long-term Phillips curve is formed by the continuous movement of the short-term Phillips curve.