The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, Hernando de Soto. Basic Books, 276 pages, $27.50.

Solving third-world poverty is the alchemy of economics. For decades international-development specialists have searched for the magical combination of programs and policies that would transform poor countries into rich, advanced economies. But all the recent formulas--including micro-enterprise loans, infrastructure investments in roads and bridges, and "human capital" spending in health and education--have failed to produce gold.