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Hyperinflation: Inflation Tax and Economic Policy Regime

In: Exploring the Mechanics of Chronic Inflation and Hyperinflation

Author

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  • Fernando de Holanda Barbosa

    (Getulio Vargas Foundation Graduate School of Economics (EPGE/FGV))

Abstract

Hyperinflation is a phenomenon characterized by destruction of money value at a finite time interval. Economic theory attempts to explain this phenomenon by using two alternative hypotheses: fundamentals and bubbles. In the first hypothesis, the model produces a steady state in which the real quantity of money is zero (m=0) and the price level is infinite, or hyperinflation occurs due to the nonexistence of an equilibrium solution of the model.

Suggested Citation

  • Fernando de Holanda Barbosa, 2017. "Hyperinflation: Inflation Tax and Economic Policy Regime," SpringerBriefs in Economics, in: Exploring the Mechanics of Chronic Inflation and Hyperinflation, chapter 0, pages 61-75, Springer.
    • Handle: RePEc:spr:spbchp:978-3-319-44512-0_6
    DOI: 10.1007/978-3-319-44512-0_6
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    References listed on IDEAS

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    4. Obstfeld, Maurice & Rogoff, Kenneth, 1983. "Speculative Hyperinflations in Maximizing Models: Can We Rule Them Out?," Journal of Political Economy, University of Chicago Press, vol. 91(4), pages 675-687, August.
    5. Buiter, Willem H, 1987. "A Fiscal Theory of Hyperdeflations? Some Surprising Monetarist Arithmetic," Oxford Economic Papers, Oxford University Press, vol. 39(1), pages 111-118, March.
    6. Gray, Jo Anna, 1984. "Dynamic Instability in Rational Expectations Models: An Attempt to Clarify," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 25(1), pages 93-122, February.
    7. Olivier Jean Blanchard & Stanley Fischer, 1989. "Lectures on Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262022834, December.
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