This algorithm reduces the definition of "an object is not needed anymore" to "an object is unreachable".
This algorithm assumes the knowledge of a set of objects called roots (In JavaScript, the root is the global object). Periodically, the garbage-collector will start from these roots, find all objects that are referenced from these roots, then all objects referenced from these, etc. Starting from the roots, the garbage collector will thus find all reachableobjects and collect all non-reachable objects.
This algorithm is better than the previous one since "an object has zero reference" leads to this object being unreachable. The opposite is not true as we have seen with cycles.
As of 2012, all modern browsers ship a mark-and-sweep garbage-collector. All improvements made in the field of JavaScript garbage collection (generational/incremental/concurrent/parallel garbage collection) over the last few years are implementation improvements of this algorithm, but not improvements over the garbage collection algorithm itself nor its reduction of the definition of when "an object is not needed anymore".