The Telegraph’s Jeremy Warner files this report on the escalating cat-fight between two of the world’s best known economists regarding the best cure for the world’s economic ills.

Not since Ken Rogoff’s famous attack on Joe Stiglitz has the dismal science of economics provoked such pompous, self-important, personalised squabbling. Professors Paul Krugman and Niall Ferguson, of course, have form; they’ve been at it on and off for nearly a year now over the efficacy of deficit spending in fighting the downturn, and today they return to the fray.

The occassion was another piece that Ferguson, an eminent economic historian, has penned for the Financial Times on the dangers of attempting to spend your way to economic recovery. Foolishly – or perhaps deliberately, for it is sometimes possible to imagine that the two have secretly agreed to slag each other off for the publicity – he mentions Krugman by name. “Those economists, like New York Times columnist Paul Krugman”, he writes, “who liken confidence to an imaginary “fairy” have failed to learn from decades of economic research on expectations. They also seem not to have noticed that the big academic winners of this crisis have been the proponents of behavioural finance, in which the ups and downs of human psychology are the key”.

Quick as flash, Krugman has risen to the bait. On his New York Times blog, he writes “Brad DeLong does the necessary on Niall Ferguson; no need for me to pile on”. But then he attempts to do precisely that, and with a ladle too. The detail of the argument need not bother us here.

Warner comes down on the side of Ferguson, taking the position that can be summed up as, “If the trillions of dollars already spent didn’t fix our problems, why should we think that trillions more dollars will?” going so far as to compare Krugman to Former Vice President Dick Cheney in the shared view that “deficits don’t matter”.