State-Controlled Finance

Definition ∞ State-controlled finance describes a financial system where the government exerts significant or complete authority over banking, credit allocation, and currency issuance. This centralized approach allows the state to direct economic resources and implement monetary policy directly. It contrasts with market-driven financial systems, where private entities hold more autonomy.
Context ∞ News often discusses state-controlled finance in relation to the development and implementation of central bank digital currencies, particularly in economies where the government maintains tight control. The potential for central bank digital currencies to enhance state oversight of financial transactions and influence economic behavior is a frequently debated topic. This approach raises questions about individual financial privacy and governmental power within digital economies.