An overview of the multiple digit hyperinflation experienced in Germany between the years 1914-1923.
Written in 2006; 2,412 words; 6 sources; MLA; $ 73.95
Paper Summary:
This essay discusses the hyperinflation that engulfed Germany between the years 1914-1923. The paper discusses the causes and outcomes of this hyperinflation and does so in terms of contemporary inflation theory. The paper also considers the Federal Reserve's interest in keeping inflation at a zero level. The paper makes it clear by the end of the essay that hyperinflation is devastating to a national economy, but low inflation may actually be healthier to an economy than zero inflation.
Table of Contents
Causes and Outcomes
Economic Theory and Hyperinflation
The Federal Reserve and a Zero Inflation Policy
Conclusion
From the Paper:
"Although the printing of enormous amounts of paper money was a large cause for concern and a strong reason for the devaluation of the Mark, other factors played into the equation as well. For one thing, the allied military of the war had cut off Germany access to imported food and raw materials making the cost of these goods rise or inflate. (Ibid. P.4) This rise in price was not to occur until after the summer 1921 as Government imposed price ceilings were in place to limit 'public discontent' (James, P.251) Complicating this problem was the loss of farm workers to the war as this loss caused farm productivity to decline as women and children were charged with greater responsibility in managing farms. (James, P.250) Thus until 1921, the goods available for consumption declined whereas after 1921 the prices of those limited goods rose rapidly."
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