21. Hyperinflations Are Rare, but a Breakup of the Euro Area Could Prompt One
- Author:
- Anders Åslund
- Publication Date:
- 11-2012
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Hyperinflation is one of the most misused words in the English language. Two years ago, I heard a prominent American investor say that we were about to get hyperinflation, “not 15 percent a year as under Jimmy Carter but perhaps 5 percent a year.” Hyperinflation is usually 1,000 percent or more a year. The standard definition by Philip Cagan (1956) is that hyperinflation starts when inflation reaches 50 percent a month, and then the economy is in hyperinflation for one year until monthly inflation falls and stays below 50 percent.
- Topic:
- Economics, International Trade and Finance, Markets, Regional Cooperation, and Monetary Policy
- Political Geography:
- Europe