In the classic 1980s film Trading Places, two of the world's most important businessmen find themselves on opposite ends of the nature versus nurture debate. In order to settle a one dollar bet, they put one rich stockbroker on the street and promote a homeless man into his position. The aim is to see if the beggar can thrive from such lowly roots and the well-bred stockbroker recover his fortune.

A nature versus nurture experiment is also under way at two of the world's most powerful central banks. Ben Bernanke, the chairman of the United States Federal Reserve, firmly believes in the need for nurture. He has slashed interest rates in the US over the past year, while his counterparts at the US Treasury have joined in by pumping out tax rebates in an attempt to help the flailing US economy.

At the Bank of England, meanwhile, the Governor, Mervyn King, appears to have placed his faith in nature. Last week, the Bank's Monetary Policy Committee kept interest rates on hold. And when King unveils the committee's latest assessment of the economy in the quarterly Inflation Report on Wednesday, he is likely to stress that rate cuts remain firmly off the agenda.

Despite their radically different approaches, both Bernanke and King still seem to expect a similar outcome for their respective economies. Sure, a period of lacklustre growth may be in prospect. But their best guess is that, before too long, this will be followed by a perky rebound in activity. Indeed, in the last Inflation Report, the Bank of England forecast that by the end of next year, the UK should be cruising along at a similar pace to that seen during the golden years of the past decade.

All of which presents something of a puzzle. What makes the Bank of England, unlike the Federal Reserve, believe that its economy can navigate its own way back to the path of economic recovery?

A key difference between the Bank's and Fed's views relates to the impact of falling house prices. A long-standing belief at the Bank of England has been that a collapsing housing market won't necessarily spill over into the real economy. The argument goes that those planning to trade down may lose out as house prices tumble. But those trading up in the future gain. Like in the movie, they're simply trading places.

This argument provides an intellectual slap in the face to those doom-mongers who proclaim that housing market meltdown spells Armageddon for the wider UK economy. But there's just one problem. The reality isn't quite as straightforward as the theory might suggest.

In practice, the behaviour of housing market winners is not a mirror image of the behaviour of housing market losers. For a start, some of the main beneficiaries of lower house prices haven't yet been born! And, for the rest of us, our response to housing market developments will depend on key characteristics - such as age.