The dynamics of hyperinflation

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PDF-Portuguese (Português (Brasil))
Published: Jan 1, 1993
DOI: https://doi.org/10.1590/0101-31571993-0637
Keywords:
Hyperinflation money supply

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Fernando de Holanda Barbosa
Da Escola de Pós-Graduação em Economia da Fundação Getúlio Vargas – FGV e do Departamento de Engenharia de Produção da Universidade Federal Fluminense – UFF, Rio de Janeiro/RJ, Brasil.
Waldyr Muniz Oliva
Do Instituto de Matemática e Estatística da Universidade de São Paulo – IME-USP, São Paulo/SP, Brasil.
Elvia Mureb Sallum
Do Instituto de Matemática e Estatística da Universidade de São Paulo – IME-USP, São Paulo/SP, Brasil.

Abstract

A hyperinflation model is developed where the money and goods markets clear
instantaneously, expectations are rational and there is inertia in the price system due to
wage indexation mechanisms. The model is described by a nonlinear system of differential
equations and Hopf bifurcation theorem, regarding the public deficit as a parameter, is used
to study the dynamic properties of the system. The dynamics of the model is capable of generating
hyperinflation processes, as well as other paths that are commonly observed in high
inflation countries.


JEL Classification: E31; E37.

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How to Cite
Barbosa, Fernando de Holanda, Waldyr Muniz Oliva, and Elvia Mureb Sallum. 1993. “The Dynamics of Hyperinflation”. Brazilian Journal of Political Economy 13 (1):3-23. https://doi.org/10.1590/0101-31571993-0637.
Issue
Vol. 13 No. 1 (1993): Jan-Mar / 1993
Section
Review