This segment of the latest science bloggingheads contains an interesting definition of science. In short: theory (a collection of hypotheses) suggests places to look for data and then data, once found, doesn’t falsify but it increases or decreases confidence in particular theories.
Under this view, Ottaviano/Peri’s result decreased the confidence in a production economy where immigrants and natives are perfect substitutes. Borjas’ response, not rejecting the hypothesis of perfect substitutes, doesn’t really repair confidence in his theory. To repair confidence, he would have to demonstrate that implications of his model, that differ from the implications of the “complementarity” model, are true.
UPDATE: he goes back to this issue later in the show. The whole thing is worth watching actually.