The Georgian Hyperinflation and Stabilization

May 1, 1999

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Format: Chicago

Jian-Ye Wang. The Georgian Hyperinflation and Stabilization, (USA: International Monetary Fund, 1999) accessed September 19, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper anlayzes the Georgian hyperinflation of 1993-94, which featured endogenous fiscal expenditures and the money supply, depreciation, and currency substitution. Hyperinflation was stopped by removing generalized consumer subsidies and tightening of monetary policy, and not by a sudden rush of credibility or imposition of an exchange rate anchor. A de facto exchange rate anchor served ex post as a vehicle for building credibility, which ensured a dramatic reversal of currency substitution when the currency reform was implemented. The paper also discusses the relatively rapid output recovery in Georgia.

Subject: Currencies, Exchange rates, Foreign exchange, Hyperinflation, Inflation, Monetary base, Money, Prices

Keywords: Broad money, Central bank, Coupon economy, Coupon exchange rate vis-à-vis, Coupon inflation, Coupon price inflation, Coupon vis-à-vis, Currencies, Exchange rate, Exchange rate depreciation, Exchange rate vis-à-vis, Exchange rates, Georgia price liberalization, Hyperinflation, Inflation, Monetary base, Nominal exchange rate, Real value, Ruble exchange rate, Unit of account, WP

Publication Details

Pages:

34
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1999/065
Stock No:

WPIEA0651999
ISBN:

9781451848663
ISSN:

1018-5941

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