Austrian Economics is a viable research program in economics, that continuously struggles
to find its footing in the mainstream departments, but is not completely absent from the
mainstream.  I, for example, have held faculty or research appointments at New York
University, Stanford University, London School of Economics, Stockholm School of
Economics, Russian Academy of Sciences, and the Max Planck Institute in Germany.  Rizzo is
still teaching at NYU (a top 20 department) as is David Harper.  And others are scattered
across various PhD programs and elite undergraduate institutions.
  
But Austrian economics also has a huge lay following and public policy following, which is
an entirely different manner.
  
Often individuals slide between these two worlds and that sometimes creates very unusual
signals for those outside (including students) to read on what is Austrian economics
actually about.  And the Mises Institute has a huge internet presence and this also
creates yet another signal to outsiders and students.
  
Austrian economics is both orthodox and heterodox, which again makes it an unusual mix of
ideas --- it is often orthodox in its emphasis on the invisible hand, but it is heterodox
in the way it approaches the study of invisible hand explanations.
  
On the issue of "acceptance" --- I just put this out as a conjecture subject to
refutation, but I believe it to be the case that no other Nobel prize winning economist
gets mentioned by other Nobel Prize winners more frequently in a positive way than Hayek.
Consider Phelp's article in the WSJ the other day on "Dynamic Capitalism" --- who is the
one figure he singles out who understood the dynamics of capitalism --- Hayek.  This was
true for Buchanan, Coase, North, and Vernon Smith as well, when they were awarded the
Nobel Prize.  Look at their Nobel Prize addresses, the discussions on their work right
after they won, etc.  Hayek was an inspiring figure to many who have gone on to make major
contributions to contemporary economic science.  Must be something about those ideas that
he got from Menger and Mises --- or at least that is the hypotheis I would put forth.
  
As for judging the Austrian School ... I think it is best to judge the best who practice
within the tradition rather then the marginal players.  Don't judge classic Austrian works
by reading von Philippovich by by reading Menger, Wieser and Bohm-Bawerk. The internet
sometimes confuses the signals on who is major contributor, but we tend to get it right
when looking backwards --- we read Menger and not Phillipovich.  Similarly, I wouldn't
judge contemporary Austrians by reading marginal players, but by reading Mises, Hayek,
Lachmann, and Kirzner.  Rothbard is an interesting character because his best academic
work is as good as anyone's, but he is also a very ideological writer.  As was Mises.
  
Mises and Rothbard have had a major influence on the modern Austrian movement in America
--- they were the inspiring figures.  But that movement was split in two --- those who
picked up more or less the analytical project that had ideological implications, and those
who picked up the ideological project that had analytical/methodological implications.  I
think if you look at the work of Mario Rizzo, Lawrence White, and Don Lavoie --- you will
see individuals who picked up the analytical/methodological project and tried to make
contributions to the economics profession --- the ideological side of their work is less
pronounced.  It is there no doubt, but it is not what is the lead punch.
  
Rizzo teaches at NYU, White is the Hayek Professor at University of Missouri at St. Louis
(after teaching at U of Georgia), and Lavoie was the Koch Professor at GMU before his
untimely passing in 2001.  Their articles are published in mainstream outlets (Journal of
Legal Studies, Journal of Money Credit and Banking, AER, etc.) and their books are
published by mainstream publishers (Cambridge University Press, University of Chicago
Press, etc.).
  
Robert Higgs, an economic historian heavily influenced by Austrian economics, taught for
years at Univesity of Washington, and published papers in the Journal of Economic History
and two books with Oxford University Press that our great contributions to economic
history that reflect the interpretative power of the Austrian School --- Crisis and
Leviathan, and Depression, War and Cold War.
  
Roger Garrison (of Auburn) has contributed to the mainstream journals from the Austrian
perspective on issues of money, business cycle, and fiscal policy.
  
Tyler Cowen (of GMU) has been in the mainstream journals, published with Harvard and
Princeton University Presses, and currently has the "Economic Perspectives" column with
the NYT.  Tyler grew up in the Austrian tradition and has contributed to it over the years
--- if at an arms length --- but his work exhibits the deep influence of the Austrian
school through and through.
  
So the best practioners in the Austrian tradition have been able to contribute to the
mainstream discourse on economic issues.  Of course, for those of us who believe
passionately in the insights and analytical approach of Menger, Mises, Hayek, Rothbard and
Kirzner, the Austrian school has had less impact on the teaching of economics and research
in economics than we would like to see.  But there are Austrian textbooks and professors
teaching in PhD programs, and researchers getting into journals regularly like the Journal
of Law and Economics, Journal of Legal Studies, Journal of Economic History, Journal of
Economic Organization and Behavior, Journal of Law, Economics and Organization, let alone
the AER and JPE.  (I haven't mentioned HOPE, or JHET, or RHET&M or EJHET because while
these are the main outlets in history of thought, history of thought is not a mainstream
field --- there are more thinkers interested in Austrian theorizing (e.g., Andrei
Shleifer) at top tier sc
hools than there are those who care about history of ideas in economics).  But that
reminds me --- Bruce Caldwell is the leading historian of the Austrian tradition and
Bruce's work has been brilliant and placed in the highest outlets in our profession, AER,
and JEL, etc.  And of all the thinkers around, he understands these science wars because
they played out so critically in Hayek's work.
  
So a long winded reply to your question about the Austrian school.  It is alive and well,
and its practioners are constantly knocking on the door to be let in the mainstream
economic conversation, a few have been let in, others get frustrated and either quick
knocking or start knocking harder or unfortnately start screaming.  To answer your
question, you decide who to listen to.
  
BTW, as for the youngest generation of Austrian economists and where they are able to
place their work --- I suggest you check out Peter Leeson (www.peterleeson.com) and Chris
Coyne (www.ccoyne.com).  Pete's dissertation on the political economy of conflict and
cooperation has led to two papers being published in Journal of Law and Economics and
Journal of Legal Studies.  Chris's dissertation work will be published as a book with
Stanford University Press.   These two guys are unapologetically Austrian, but just do
solid work and tackle pressing questions in economics and political economy.
  
Pete Boettke  
  
*I am currently visiting at the London School of Economics as the 2006 Hayek Fellow.  This
my second time as I was the 2004 Hayek Fellow as well.
  
**I run the blog -- The Austrian Economists -- which tries to track the development of
arguments in the Austrian tradition as they relate to trends in economic thinking and also
contemporary policy disputes.