In part he believes that the problem is economic institutions: regulatory barriers to entrepreneurship, a financial system that favours insiders, and a high level of input from labour, which tends to be biased towards the status quo.
Suppose, he says, that a developing country exports goods made with adult labour, but relies on an input made in an unregulated industry using child workers.
While companies faced growing pressure from rising costs of input materials, including fuel, food and labour, that was not matched by rising output prices.