Some may say it is a result of working at the Fed, but I've always been interested in inflation and hyperinflation. I would point to early interest when my grandfather gave me several currency notes from Weimar Germany (circa 1923) ranging from 500,000 marks to 100 million marks. His stories about the time period always fascinated me. (My favorite was the one about going to a restaurant and paying when you ordered because the price would change by the time the food arrived.)
Consequently, I was attracted to Greg Mankiw's post today about hyperinflation in Zimbabwe. He links to two stories in the New York Times which are definitely worth reading. You may find the policy prescriptions particularly interesting. Once you've done so, I then encourage you to visit my recent post (January 24, 2007) on economic growth. Go to the recommended link. Once there, select "Zimbabwe" and run the graphic. Of particular note are the dates of 1980 and 1987. You might want check out the Zimbabwe 's political history at those points.
I'd be interested in your conclusions, if any.
I would hope that your student can recognize that this is another example of interesting coincidence, as opposed to correlation or causality.
For an interesting lesson regarding inflation in Zimbabwe, check Aplia Econ Blog.
Posted by TSchilling at 11:41 AM Comments (0)