ABSTRACT
The monetary system of the planned economies represents a special case; none of the traditional monetary theories is adequate to explain it, since it functions in an economic system that proclaimed its intention to abolish money but proved unable to do so, although it did restrict considerably its use and functions. The redistributive function is much more developed in a planned economy, which assumes total control over economic life and determines the direction of development as well as the allocation of financial resources. Time has brought many changes, however, in the way these functions are exercised and in the relation between the state and the enterprise. In a planned economy, both the enterprise as borrower and the bank as lender are largely or wholly state owned. Credit therefore has a totally different economic import and is used in totally different ways than in a market economy.
