arXiv research

The paper models US inflation and hyperinflation using monetary and GDP data.

A model proposed by Sornette, Takayasu, and Zhou for describing hyperinflation regimes based on adaptive expectations expressed in terms of a power law which leads to a finite-time singularity is revisited. It is suggested to express the price index evolution explicitly in terms of the parameters introduced along the t…

We present a novel analysis extending the recent work of Mizuno et al. [2002] on the hyperinflations of Germany (1920/1/1-1923/11/1), Hungary (1945/4/30-1946/7/15), Brazil (1969-1994), Israel (1969-1985), Nicaragua (1969-1991), Peru (1969-1990) and Bolivia (1969-1985). On the basis of a generalization of Cagan's model …

The aim of this work is to address the description of hyperinflation regimes in economy. The spirals of hyperinflation developed in Brazil, Israel, and Nicaragua are revisited. This new analysis of data indicates that the episodes occurred in Brazil and Nicaragua can be understood within the frame of the model availabl…

In 1979 following a decade of hyperinflation, Iceland introduced Verðtryggð lán, negatively amortised, index-linked loans whose outstanding principal is increased by the rate of the consumer price inflation index(CPI). The loans were part of a general government policy which used indexation to the CPI to address the ec…

Compound interest as well as inflation grows exponentially with time, whereas other means to repay debt grow polynomially. For this and other, mostly political, reasons, debt without inflation is unsustainable. We suggest a discontinuous way to eliminate debt by nullifying it. This scenario is preferable to current cen…

An extension of the nonlinear feedback (NLF) formalism to describe regimes of hyper- and high-inflation in economy is proposed in the present work. In the NLF model the consumer price index (CPI) exhibits a finite time singularity of the type $1/(t_c -t)^{(1- β)/β}$, with $β>0$, predicting a blow up of the economy at a…

We study a novel pricing operator for complete, local martingale models. The new pricing operator guarantees put-call parity to hold for model prices and the value of a forward contract to match the buy-and-hold strategy, even if the underlying follows strict local martingale dynamics. More precisely, we discuss a chan…

Hyperinflation and price volatility in virtual economies has the potential to reduce player satisfaction and decrease developer revenue. This paper describes intuitive analytical methods for monitoring volatility and inflation in virtual economies, with worked examples on the increasingly popular multiplayer game Old S…

We investigate the Heston model with stochastic volatility and exponential tails as a model for the typical price fluctuations of the Brazilian São Paulo Stock Exchange Index (IBOVESPA). Raw prices are first corrected for inflation and a period spanning 15 years characterized by memoryless returns is chosen for the ana…

For environmental problems such as global warming future costs must be balanced against present costs. This is traditionally done using an exponential function with a constant discount rate, which reduces the present value of future costs. The result is highly sensitive to the choice of discount rate and has generated …

We propose a method for causal inference using satellite image time series, in order to determine the treatment effects of interventions which impact climate change, such as deforestation. Simply put, the aim is to quantify the 'before versus after' effect of climate related human driven interventions, such as urbaniza…

High future discounting rates favor inaction on present expending while lower rates advise for a more immediate political action. A possible approach to this key issue in global economy is to take historical time series for nominal interest rates and inflation, and to construct then real interest rates and finally obta…