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Stability problems in hyperinflation models

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  • Zink, Helmut

Abstract

Traditional monetary models of hyperinflation suffer from severe stability problems: equilibria with realistic comparative-static properties are unstable while those with unrealistic comparative statics are stable. In the present paper I develop a model of hyperinflation which is based on an analysis of firms' payment behavior and which uses a weaker concept of stability. The stability properties of this model are consistent with the empirical evidence.

Suggested Citation

  • Zink, Helmut, 1993. "Stability problems in hyperinflation models," Discussion Papers, Series I 268, University of Konstanz, Department of Economics.
    • Handle: RePEc:zbw:kondp1:268
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    More about this item

    Keywords

    Monetary theory; hyperinflation; stability;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium

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