This case study draws heavily on Moosa (2004a, 2004b). Iraq is a case of a postwar country that experienced hyperinflation resulting from excessive currency printing. Between 1991 and 1995, the nominal value of the currency in circulation jumped from 22 billion to 584 billion, giving rise to an average annual inflation rate of 250 per cent. Monetary reform in post-Saddam Iraq is an issue that has been dealt with in the academic literature (for example, Hanke, 2003a; Roubini and Sester, 2003), in the media (for example, Hanke, 2003b) and in policy documents (for example, Sanford, 2003). King (2004) used the case of Iraq to demonstrate that expectations of future collective decisions can have a major impact on the value of a currency, irrespective of the policies pursed by the current government.
KeywordsExchange Rate Monetary Policy Central Bank Foreign Exchange Exchange Rate Regime
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