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Money and credit - Ivanov V.M.


17.1. Economic boundaries of credit

Like any economic phenomenon, credit has boundaries in which its essence is realized. In relation to economic categories, the concept of "border" should be considered as the limit of distribution of certain types of economic relations. From this perspective, the economic boundaries of credit in the general theoretical sense should be understood as the limit of relations regarding the return movement of value. The economic boundaries of the spread of credit relations are those in which their existence is objectively necessary and they retain their special features. The development of credit relations beyond the economically justified limit inevitably leads to their degeneration, distortion of the essence of credit.

The theoretical development of the problem of the economic boundaries of credit is of very practical importance, as it determines the methodological approaches to the organization of sound monetary and credit regulation of the economy. Changing the boundaries of the loan affects the volume of money supply and, therefore, the stability of money circulation.

As you know, credit operates in close interweaving and interaction with many economic processes and phenomena. In order to isolate credit relations, to determine their boundaries, it is necessary to separate them from other economic relations in space and time, based on the specifics of their essence.

As a material process, credit has spatial, temporal and qualitative certainty. This means that credit relations occupy a strictly defined position in space (credit flows are isolated from other cost flows), the loan is finite in time and has a set of specific properties inherent only to it.

Thus, in a philosophical sense, we can talk about the spatial, temporal and qualitative boundaries of credit.

The identification of the concept of "border" is not limited to the separation of one economic phenomenon from another. The border is at the same time the basis for the interconnection of economic categories, that feature of contact through which their mutual influence on each other is realized.