An anonymous commenter chides me (here) for not linking to Greg Mankiw's response to Robert Frank's NYTimes column which concluded that the 'trickle-down' theory "is ripe for abandonment." Even before I located Mankiw's response, he had already posted Frank's rebuttal to his critique!
Mark Thoma has all the relevant links, along with some comments of his own. Some parts of the discussion get decidedly technical, but Frank's rebuttal is, like his original column, lucid and largely accessible. I learnt a new phrase from it: "context externality"