"Trickle Down Theory" is a meme used (mostly by non-economists) to ridicule certain economic policies and the theories on which those policies are supposedly based. My first year students sometimes ask me to explain it to them, not understanding that it's a meme and not a theory.
"Magic Dirt Theory" is a similar meme, of more recent (and "deplorable") origin (a quick search tells me it's from Vox Day/Supreme Dark Lord). But ideas, including memes, should be evaluated on their merits. Here is a critique of that meme, from a nationalist/conservative perspective.
You have probably heard of "Trickle Down Theory". But only 16% of the (probably unrepresentative) 127 people who answered my Twitter poll (thanks!) had heard of "Magic Dirt Theory". And the percentage was smaller for economists than for non-economists. This is a smaller percentage than I thought it would be, but not trivially small. I don't know whether in the long run it is memes that are powerful for good or evil.
Standard economic theory has a reasonably good defence against the implied critique in the Trickle Down Theory meme. "Will the benefits in fact trickle down from rich to poor (or trickle up from poor to rich)?" is the sort of question we can answer, at least in principle. "It depends" is normally the right answer, and we can say what it depends on, in particular the specific policy change being considered. This caricature of economic theory doesn't really work, if you have any knowledge of economics.
I am less confident that standard economic theory has a reasonably good defence against the implied critique in the Magic Dirt Theory meme. The caricature sometimes seems to fit. Translated into economese, the critique is about productivity parameters that are implicitly assumed to be policy-invariant, without much thought about what precisely those parameters represent, and whether they would in fact be invariant to the sorts of policy changes the model is used to evaluate. It's a Lucas Critique. Magic Dirt is the cross-sectional version of time-series phlogiston productivity shocks (pdf).
If I read 'It is places, not individuals, that are productive' the Magic Dirt Theory meme springs to my mind. (Memes are effective). What is that special property of different places that creates those productivity differentials? Can we assume it remains fixed, if individuals move around?
Here's my version of the meme:
Start with a very simple model. Land and labour produce corn. Constant returns to scale technology (if you double both labour and land inputs you double corn output). Diminishing Marginal Product of Labour (the extra output per extra worker falls as you add more and more labour to a fixed amount of land). All land is identical. All labour is identical. Same technology everywhere. Perfect competition, so the real wage in any country equals the MPL in that country. Countries with a higher land/labour ratio will have higher MPL and wages, lower rents, and higher GDP per worker. Workers who migrate from countries with a low land/labour ratio will see their wages rise, and world output of corn will rise too (because their MPL will be higher in their new country than in their old country). Open borders (and no costs of migration) will equalise wages everywhere and maximise world output. Malthus and Ricardo would have understood this model.
Now change one assumption. The fertility of the land differs across countries. But the economists who study the world economy do not know this. All the economists know is that, for some unexplained reason, wages and productivity of labour and land are higher in some countries than in others. So they model the world economy with each country having its own country-specific production function.
Those economists have a "Magic Dirt Theory" of the world economy. Some countries have an unexplained Absolute Advantage over other countries, and the economists treat that absolute advantage as a structural ("deep") parameter that is invariant to the open borders policy experiment.
Fortunately for the economists, the "dirt" really is "magic" in this case. Because I assumed it is. So their model of the world economy works perfectly well, even if they don't know why it works. Open borders will maximise world output and equalise wages just like in the simpler model. The only difference is that land rents and land/labour ratios will be different across countries (more fertile land will have higher rents and probably more workers per acre).
The danger comes if the economists use a magic dirt theory where the dirt is not in fact magic, and the parameters that are assumed to be policy-invariant are not in fact policy-invariant. Like if it is cross-country variance of some sort of social institutions that creates productivity differentials. Unlike magic dirt, those social institutions may or may not change when migration policy changes. Do institutions remain attached to the place, like the fertility of the soil, even if all the people move? It depends. But I'm not confident that economists have any special ability to say what it depends on.
We can at least recognise the problem.