Hyperinflation is an extreme form of monetary breakdown in which prices rise by at least 50% per month. Following Philip Cagan's 1956 seminal study, "The Monetary Dynamics of Hyperinflation”, this threshold was established and has become the standard custom and practice used in the economics profession. Note, if the inflation rate was 50 percent in each month of the year, the annual inflation rate would equal 12,874%. Professor Steve H. Hanke has spent decades measuring, analyzing, and advising governments on the most severe currency collapses in modern history. His work combines real-time market data with rigorous economic frameworks to diagnose crises and design lasting solutions.
Hyperinflation sits at the center of Professor Hanke's life's work. For decades, he has measured, analyzed, and advised governments on some of the most severe monetary breakdowns in modern history, from collapsing currencies to the complete erosion of public trust in financial systems. These episodes are not merely economic failures; they are human crises that destroy savings, destabilize societies, and reshape political outcomes.
Using primary data, Professor Hanke has measured every hyperinflation episode that has ever existed. These are contained in the Hanke-Krus World Hyperinflation Table. At present there are 71 episodes. His remedy for killing hyperinflations has been the introduction of either a currency board or full dollarization. Those remedies have never failed, and have allowed Hanke to kill more hyperinflations than any living economist.
The model Hanke developed for the measurement of hyperinflation relies on Purchasing Power Parity. A key input to the model is black market exchange rate data. When it comes to black market data, Hanke has one of the largest archives of this data that exists.
Learn more about What Is Hyperinflation and the Hanke-Krus Model
Hanke's Methodology
Professor Hanke employs the concept of Purchasing Power Parity to calculate implied inflation rates. This is summarized in the following equation:
What Causes Hyperinflation?
Hyperinflation does not occur at random. Every episode of hyperinflation was a result of a breakdown in which government expenditures could not be financed by taxation or via international and local credit markets. In those cases, the only source of financing is a central bank that purchases and monetizes bonds issued by the government. This was the case in the 1994 hyperinflation episode in Yugoslavia, when the monthly inflation rate was 313 million percent, and over 95% of government expenditures were being financed by the central bank (read: the printing press).
Learn more about what causes hyperinflation
Hanke's Inflation Dashboard
Every week, Professor Hanke publishes country-by-country inflation estimates on X/Twitter (@steve_hanke) using the #HankeInflationDashboard. These estimates are made by using Professor Hanke’s Purchasing Power Parity measurement model and black-market exchange rates. This provides a true picture of inflation in countries where official statistics are manipulated or suppressed.
Weekly Inflation Dashboards are now updated. View the latest rankings at the #HankeInflationDashboard
Steve Hanke: The Money Doctor
Professor Hanke is widely known for diagnosing and resolving currency collapses across emerging and crisis-stricken economies. Throughout his career, he has advised governments in Argentina, Estonia, Lithuania, Bulgaria, Bosnia Herzegovina, Montenegro, Ecuador, Zimbabwe, and many more. To kill inflation and establish stability, his approach centers on creating currency boards or pursuing dollarization. While stability might not be everything, everything is nothing without stability.
Learn more about Hanke's solutions to hyperinflation
Case Studies
- Zimbabwe — The second-worst hyperinflation ever recorded
- Venezuela — The 57th confirmed episode in the Hanke-Krus Table
- Hungary — The worst hyperinflation in recorded history
Explore This Topic
- What Is Hyperinflation? (Definition and the Hanke-Krus Model)
- What Causes Hyperinflation?
- Consequences of Hyperinflation
- Hanke's Solutions to Hyperinflation
- The Hanke-Krus World Hyperinflation Table — The definitive catalogue of 62 documented hyperinflation episodes
- Hanke Misery Index — Composite measure of economic pain: inflation + unemployment + lending rate − GDP growth
Related Topics
- Monetarism — The theoretical foundation for understanding inflation
- Currency Boards — A key institutional solution to monetary instability
- Dollarization — Replacing a failed currency with a stable foreign one
Recent Publications (2025–2026)
- Lódz Ghetto Hyperinflation — Journal Article, World Economics
- Hyperinflation: Zambia, CAF Zone & Belarus — Journal Article, World Economics