Just not in the way you thought. One of the big... controversies surrounding the upcoming PlayStation Vita was that it was not backwards compatible with the PSP, in the sense that it doesn't have a UMD slot.
Never mind that most of the PSP gamers had long moved over to PSN downloads, which are backwards compatible, a number of people had a funny opinion that the Vita should support every legacy system out there.
But good news for that minority. SCE's development head Yoshio Matsumoto has said that those who own PSP games on UMDs, will be able to download PSP games on PS Vita at a special low price. Details are not known at this stage, but this is nonetheless very good news...
Assuming that "low price" doesn't just mean 10 per cent off, naturally.