Many Austrian economists claim that Bitcoin cannot work due…
Many Austrian economists claim that Bitcoin cannot work due to Mises' regression theorem; so how does Bitcoin acquire a legitimate market price?
As @24 succinctly puts it, from the economic cost of producing a partially inverted hash; i.e. proof-of-work.
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The cost is proof that you can negotiate with someone to get work out of him in exchange for bitcoins.
Right; I wanted to explicitly point out that it's about opportunity cost, but I had zero characters left even after slightly modifying your original quote to make it fit.
I hope Twetch will extend its character limit soon, hopefully by a lot.
Sorry it's just that people get confused a lot by this idea.