THE THEORY OF MONEY AND CREDIT

LUDWIG VON MISES

This is an extract from the Wikipedia entry

Reviewer comment:
The content is pure theory - based on deductive reasoning. His deduction about the origin of money stems from Adam Smith's remark about 'barter' and 'demand for money commodity' The truth was unknown until the texts of Mesopotamian cuiedorm documents were translated. David Graeber now has published the story in his book Debt, and Michael Hudson has published a long list of books also showing that the barter story is pure myth. But Austrian School economist theoreticians such as Murray Rothbard continue to believe it.

The Theory of Money and Credit is a 1912 economics book written by Ludwig von Mises, originally published in German as Theorie des Geldes und der Umlaufsmittel. In it Mises expounds on his theory of the origins of money through his regression theorem, which is based on logical argumentation. It is one of the foundational works of the Misean branch of the Austrian School of economic thought. Commodity money exists today. Mises looks at the origin, nature and value of money, and its effect on determining monetary policy. It does not concern all adaptations of money. He uses the so-called regression theorem, a statement backed by a step by step, logical reasoning. Mises explains why money is demanded in its own right. According to Mises, money has historically come about after there has been a demand for the money commodity in a barter economy.

Applications:
Along with Carl Menger's Principles of Economics, and Eugen von Böhm-Bawerk's Capital and Interest, the book is one of the foundational works of the Austrian School. Publication history 1912: Vienna: Theorie des Geldes und der Umlaufsmittel.[1] 1924: 2nd edition in German. 1934: London: Jonathan Cape Ltd. First translation (by Harold E. Batson) into English. The German word Umlaufsmittel literally translates as "means of circulation" and was translated into the text of the English version as "fiduciary media". However, the publisher thought the unusual terminology would irritate readers and substituted "money and credit" in the title, thereby losing the specific distinction Mises had made in selecting his original term.[2] 1953: New Haven, Conn.: Yale University Press. Part Four was added by Mises to this English language edition 1971: Irvington-on-Hudson, N.Y.: Foundation for Economic Education. 1978: Irvington-on-Hudson, N.Y.: Foundation for Economic Education. 1981: Indianapolis,. Ind. Liberty Fund. ISBN 0-913966-70-3. 541 pages. Hardcover. (Softcover ISBN 0-913966-71-1). 2009: Auburn, Al. Ludwig von Mises Institute. Hardcover

Criticism:
According to Michael Hendricks, "the regression theorem does a good job of explaining the creation of money, however it does not necessarily apply to all forms of money."[3]