With Tom Verducci red-flagging Bud Norris with his Verducci Effect, Sabernomics' J.C. Bradbury attempts to test the theory.
I'm not going to pull the tables and math behind it - you should read it for yourself - but I'll pull the concluding quote:
So, where are we? The results do not bode well for the Verducci Effect. Pitchers who were predicted to decline actually improved. One potential problem with this study is that pitchers who pitched no innings at all in a season were not included; however, I think this bias is slight since this number is small, as even injured pitchers normally get in a few innings every season. Frankly, this is about as quick and dirty as you can get with a test; but, it’s a starting point, and I’d like to see others examine the effect further. While appreciate the intuition behind the Verducci Effect, I don’t see much evidence for it.