ABSTRACT
Mises's book The Theory of Money and Credit presents an argument for how money came to exist. For Mises, the function of money as a common medium of exchange is not only its primary, but also its sole function. He argues that other functions of money, such as facilitating credit, follow directly from this one. Based on his argument that money is solely a common medium of exchange, Mises derives other prescriptions, including the role of government. Mises's views in The Theory of Money and Credit were foundational in the creation of an influential tradition in economics that came to be known as the Austrian School. Over a century after its initial publication, The Theory of Money and Credit remains indispensable reading for anyone interested in understanding the nature of money and the origin of some of the most important principles in mainstream economics today.
