When Money Dies: The Dynamics of Speculative Hyperinflations

• 成果类型: Article
• 署名作者: Rocheteau, Guillaume
• 署名单位: University of California System; University of California Irvine
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20231008
• 发表日期: 2025
• 页码: 1301-1337
• 关键词: competitive-equilibrium; TRANSACTION POLICY; monetary-theory; search; exchange; bubbles; MODEL; GOVERNMENT; liquidity; prices

摘要

How quickly does a fiat money become valueless? I study the speculative hyperinflation equilibria of continuous-time economies with decentralized markets where money is essential. I establish necessary and sufficient conditions under which money dies in finite time. A necessary condition is that the liquidity return of money grows unbounded as the value of money approaches zero. Under CRRA preferences, the longevity of money shrinks with the money growth rate and the frequency of liquidity needs, but it increases with seller's market power. Money duration also depends on the strictness of legal restrictions and the rates of return of competing currencies. (JEL E31, E42, E51, E52, E62)