Introduction

In scholarly work on centrally planned economies the financial sector often has received less attention than it deserves. There are a number of reasons for this. In the first place, quantitative data on money and credit have in many cases not been published on a regular basis by the countries concerned. Information on the government budget also tends to be skimpy and incomplete. However inadequate the statistics on the real sectors of centrally planned economies, they are generally far better than the financial statistics available. Perhaps more important than data problems in explaining the neglect of the financial sphere, however, is the presumption that it is relatively unimportant in explaining the performance and problems of centrally planned economies – money in the state sector is "passive;" credit has no independent role and is largely determined by outside forces like inventory accumulation. The government budget merely reflects planning geared toward the real economy and has no independent effect on firms' activities. All in all, the financial sphere may be interesting, but it should not be the main focus of scholarly research, because the institutions and policy decisions that ultimately affect economic performance are located elsewhere – in the planning system and the administrative hierarchy that supervises producers and other economic units.