The Review of Austrian Economics, 18:2, 179–194, 2005.
2005 Springer Science + Business Media, Inc. Manufactured in The Netherlands.
Money: Capital Good, Consumers’ Good,
or (Media of) Exchange Good?
WILLIAM BARNETT II firstname.lastname@example.org
Associate Professor of Economics, Department of Economics, Joseph A. Butt, S. J. College of Business Adminis-
tration, Loyola University New Orleans, New Orleans, Louisiana 70118
WALTER BLOCK email@example.com
Harold E. Wirth Endowed Chair in Economics, Department of Economics, Joseph A. Butt, S. J. College of Business
Administration, Loyola University New Orleans, New Orleans, Louisiana 70118
Abstract. Is money a producers’ good or a capital good, or is it sui generus, as Mises, Rothbard, and other
Austrians have maintained? We argue that all action is either consumption or production, and that exchange is but
a form of production. Consequently, all goods are either consumers’ goods or producers’ goods; there is no third
possibility. And that among these two money is a producers’ good, not a consumer good.
KeyWords: money, producers’ good, capital good, consumers’ good, exchange, assets, Mises, Rothbard
JEL classiﬁcation: E2, G0
Several Austrians, Mises foremost amongst them, maintain that money is neither a capital
good nor a consumers’ good.
It is usual to divide economic goods into the two classes of those that satisfy human
needs directly and those which only satisfy them indirectly: that is consumption goods,
or goods of the ﬁrst order; and production goods, or goods of higher orders. The attempt
to include money in either of these groups meets with insuperable difﬁculties. It is
unnecessary to demonstrate that money is not a consumption good. It seems equally
incorrect to call it a production good.
Of course, if we regard the twofold division of economic goods as exhaustive we shall
have to rest content with putting money in one group or the other. This has been the
position of most economists; and since it has seemed altogether impossible to call
money a consumption good, there has been no alternative but to call it a production
This apparently arbitrary procedure has usually been given only a very cursory vindi-
cation. Roscher, for example, thought it sufﬁcient to mention that money is ‘the chief
instrument of every transfer’ . . . (Mises 1980:95–96, footnote omitted)