Empirical analyses of Cagan's money demand schedule for hyper-inflation have largely ignored the explosive nature of … hyper-inflationary data. It is argued that this contributes to an (i) inability to model the data to the end of the hyper-inflation …, and to (ii) discrepancies between "estimated" and "actual" inflation tax. A simple solution to these issues is found by …

Empirical analyses of Cagan's money demand schedule for hyper-inflation have largely ignored the explosive nature of … hyper-inflationary data. It is argued that this contributes to an (i) inability to model the data to the end of the hyper-inflation …, and to (ii) discrepancies between "estimated" and "actual" inflation tax. Using data from the extreme Yugoslavian hyper-inflation …