Joseph T. Salerno

Salerno’s role in the current corpus is as the formalizer of the Rothbardian True Money Supply (TMS) and as the author of a sustained body of work defending Mises-Rothbard monetary theory against rival frameworks. Two of his texts are now ingested: the 1987 True Money Supply paper and the 2010 collected essays Money, Sound and Unsound. Other widely-known aspects of his contemporary role (academic post, editorial role at the Quarterly Journal of Austrian Economics) are not directly sourced from the ingested texts here.

Why the wiki cites him

• True Money Supply (TMS). Salerno’s 1987 paper (Ch. 3 of the 2010 collected essays) formalized Rothbard’s broad money-supply criterion (from America’s Great Depression (America’s Great Depression) Ch. 4 and The Mystery of Banking (The Mystery of Banking)) into a specific aggregate. Per Salerno’s own component breakdown (see the ingested paper), TMS comprises currency in the hands of the nonbank public + demand deposits + other checkable deposits (NOW accounts) + savings deposits at commercial banks and thrifts + MMDAs + overnight RPs + overnight Eurodollars + U.S. Savings Bonds at redemption value, plus memorandum items: U.S. government demand deposits at the Fed and commercial banks, and foreign official + foreign commercial-bank demand deposits in the U.S. Salerno excludes money market mutual funds (MMMFs), term RPs, small-denomination time deposits and CDs (treated as loans to banks), large CDs, and short-term Treasury securities. The Mises Institute publishes a TMS series.
• Broader monetary corpus. Money, Sound and Unsound (2010) collects Salerno’s monetary essays into five parts: foundations (the John Law / Turgot traditions, Mises’s monetary theory, the TMS paper, theory of money prices, international monetary theory); inflation/deflation/depression (coordination, Mises on expectations, the war/money machine, an Austrian taxonomy of deflation); the gold standard (100 percent gold proposal, true vs false gold standards, international gold standard); applications (1920s–30s monetary history, the 1987 crash, post-communist sound-money, currency-board vs currency-principle); and commentary (Greenspan critiques, gold and the Great Depression). The breadth justifies treating Salerno as a primary, not derivative, monetary authority in the Mises-Rothbard tradition.

Position in the Austrian tradition

Salerno is in the Mises-Rothbard wing of contemporary Austrian economics, distinguishable from the Hayek-Kirzner wing on the role of monetary calculation in the socialist-calculation debate (see Money, Sound and Unsound Ch. 19 on calculational chaos and the post-communist transitions) and on the pure-time-preference theory of interest (see the Foundations part of the same collection). The canonical statement of the Mises-Rothbard vs Hayek-Kirzner split — Salerno’s 1993 paper “Mises and Hayek Dehomogenized” — is not yet ingested into the corpus; once added it would let this positioning be sourced directly rather than inferred from the broader collection.

Selected works

Ingested:

• “The ‘True’ Money Supply: A Measure of the Supply of the Medium of Exchange in the U.S. Economy” (1987), Austrian Economics Newsletter Vol. 6 No. 4 — also reprinted as Ch. 3 of Money, Sound and Unsound. Full text in raw/papers/2026-05-27-the-true-money-supply-salerno-1987.md. The TMS specification cited in Monetary Aggregates and Credit Expansion.
• Money, Sound and Unsound (Ludwig von Mises Institute, 2010) — 646-page collected essays (26 chapters across 5 parts). Full text in raw/articles/2026-05-27-money-sound-and-unsound-salerno-full-text.md. The broad monetary corpus this reference page draws on.

Not yet ingested:

• “Mises and Hayek Dehomogenized” (1993) — the canonical standalone statement of the Mises-Rothbard vs. Hayek-Kirzner split on calculation. Source: https://mises.org/library/mises-and-hayek-dehomogenized. Related material is in Money, Sound and Unsound Ch. 19, but the 1993 paper is the canonical version.

See Also

• Monetary Aggregates and Credit Expansion — the concept article where Salerno’s TMS is the load-bearing definition
• The Mystery of Banking — Rothbard’s popular treatment of banking and TMS that Salerno’s paper formalizes
• Murray N. Rothbard — the source whose work Salerno extends
• Ludwig von Mises — the foundational figure Salerno’s monetary work descends from
• America’s Great Depression — Rothbard’s broad money-supply argument that TMS formalizes

Sources

• The “True” Money Supply (Salerno 1987) — full text — Salerno’s TMS paper ingested from the Mises Institute PDF. Title page and first paragraph not captured by pdftotext; body and endnotes intact with minor OCR artifacts.
• Money, Sound and Unsound (Salerno 2010) — full text — 646-page collected essays. OCR clean. Reprints the 1987 TMS paper as Ch. 3; the rest of the collection covers monetary theory, inflation/deflation/depression, the gold standard, applications, and commentary.