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Finance and Credit
 

Model representations of the fundamental principles of a sovereign State's financial policy in crisis

Vol. 21, Iss. 23, JUNE 2015

PDF  Article PDF Version

Available online: 23 June 2015

Subject Heading: Financial system

JEL Classification: 

Pages: 31-39

Afanas'eva A.N. Kazan State University of Architecture and Engineering, Kazan, Republic of Tatarstan, Russian Federation
afanaceva_ksaba@mail.ru

Importance In the study, fundamental principles of the financial policy are associated with model representations of the commodity-money balance and the conditions securing the balance. I apply a unique approach, under which I divide the commodity-money balance into three different components in terms of their hierarchy. These components relate to various institutions of power over things (movable, immovable) and over people (through the ownership of the objects of a natural monopoly).
     Objectives The objective is to study the problems of the financial policy of the State under crisis, and to develop model representations of the financial system of the State and the carried out policies, without regard to the degree of openness of the market.
     Methods The scientific research rests on simulating real-life events, taking into account the effect of various State laws and implications of their enforcement. The methodological basis of the research includes methods and principles of the system approach, the functional-structural modeling, logical analysis, statistics and program-targeted methods, as well as modern models of the financial system of the State.
     Results The study is an attempt to develop a holistic system-based model of fundamental principles of the sovereign State financial policy based on creating a single internal commodity-money balance in the country, with consideration of its various components and their interrelations.
     Conclusions and Relevance In conditions of financial crisis, the government financial policy should be independent and protected from foreign financial aggression that threatens the fundamentals of the national security and public safety.

Keywords: fiscal policy, financial crisis, money, commodity-money balance, economic criteria, inflation, investments, securities, mortgage

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