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Recent years have seen the development of new theories of market failure based on asymmetric information and network effects. According to the new paradigm, we can expect substantial failure in the markets for labour, credit, insurance, software, new technologies and even used cars. Market failure at the microeconomic level may even create or aggravate macroeconomic disturbances. This volume brings together the key papers on the subject including classic papers by Joseph Stiglitz, George Akerlof and Paul David, along with powerful theoretical and empirical rebuttals of new models of market failure.