As the rise in productivity increases potential output, the long-run aggregate supply curve shifts to the right. If, in the short run, there is now a recessionary gap (aggregate output is less than potential output), nominal wages will fall, shifting the short-run aggregate supply curve to the right. This results in a fall in the aggregate price level and a rise in aggregate output. As prices fall, we move along the aggregate demand curve due to the wealth and interest rate effects of a change in the aggregate price level. Eventually, as long-run macroeconomic equilibrium is reestablished, aggregate output will rise to be equal to potential output.