Stiglitz expands on the Wicksell Lectures presented at the Stockholm School of Economics in 1990. He critiques the fundamental theorems of welfare economics and the Lang-Lerner-Taylor theorem on the equivalence of competitive market economies and market socialism. Stiglitz also clarifies the actual nature and role played in the economy by price and nonprice mechanisms, competition, decentralization, and innovation. He then addresses the issues of privatization and the reform of capital markets. Additionally, he discusses what went wrong with the socialist experiment and considers what the economic role of the state should be. Finally, Stiglitz draws some tentative recommendations based on the new economics of information.
