Hyperinflation in a small open economy with a fixed exchange rate: a Post-Keynesian view

International audienceThis paper examines the emergence of hyperinflation in a small open economy with a fixed exchange rate from a Post-Keynesian perspective. Three variables play a key-role: distributive conflict, external debt, and expectations about the exchange rate. First, we propose a short-run Kaleckian macro-model. Then, we study the long-run behavior of the model by endogenizing the price level and foreign indebtedness. We conclude that the existence of expectations about the nominal exchange rate is crucial to explaining the emergence of hyperinflation