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The Austrian Theory of Money

Tags Austrian Economics OverviewMonetary TheoryMoney and Banking

07/20/2005Murray N. Rothbard

The Austrian theory of money virtually begins and ends with Ludwig von Mises's monumental Theory of Money and Credit, published in 1912. Mises's fundamental accomplishment was to take the theory of marginal utility, built up by Austrian economists and other marginalists as the explanation for consumer demand and market price, and apply it to the demand for and the value, or the price, of money. No longer did the theory of money need to be separated from the general economic theory of individual action and utility, of supply, demand, and price; no longer did monetary theory have to suffer isolation in a context of "velocities of circulation, " "price levels," and "equations of exchange."


Murray N. Rothbard

Murray N. Rothbard made major contributions to economics, history, political philosophy, and legal theory. He combined Austrian economics with a fervent commitment to individual liberty.


 The Foundations of Modern Austrian Economics, Edwin G. Dolan, ed., Kansas City: Sheed and Ward, 1976, pp. 160-184.See also in The Logic of Action One: Method, Money, and the Austrian School (Cheltenham, UK: Edward Elgar, 1997), pp. 297-320.