India, Aug. 11 -- Akerlof won a Nobel for showing why markets collapse when buyers cannot judge quality. Software is becoming one - and India is on the wrong side of it

I keep returning to an old paper about used cars.

George Akerlof wrote it in 1970 and had it turned down by three journals before it found a home. The argument annoyed people because it was so plain. You are buying a second-hand car. The seller knows whether it is sound. You don't, and finding out is expensive, so you offer an average price. But the owner of a genuinely good car will not sell at that price, so he keeps it. Only the bad cars are left, quality drops, buyers offer less, and the market spirals down until it barely functions. Akerlof called the bad cars lemon...