It should be clear of course that for traders to have incentives to gather information required that information not be perfectly disseminated in the… - Joseph E. Stiglitz

New technologies (reinforced by new trade rules) are enhancing the market power of incumbent, dominant firms, such as Microsoft, which are all from the developed world; for the first time, in a key global industry, there is a near-global monopolist.

At the core of the success of market economies are competition, markets, and decentralization. It is possible to have these, and for the government to still play a large role in the economy; indeed it may be necessary for the government to play a large role if competition is to be preserved. There has recently been extensive confusion over to what to attribute the East Asian miracle, the amazingly rapid growth in countries of this region during the past decade or two. Countries like Korea did make use of markets; they were very export oriented. And because markets played such an important role, some observers concluded that their success was convincing evidence of the power of markets alone. Yet in almost every case, government played a major role in these economies. While Wade may have put it too strongly when he entitled his book on the Taiwan success Governing the Market, there is little doubt that government intervened in the economy through the market.

The problem is easy to state: developing countries borrow too much—or are lent too much—and in ways that force them to bear most or all of the risk of subsequent increases in interest rates, fluctuations in the exchange rate, or decreases in income. Given this, it is not surprising that they often cannot repay what is owed.