Michael Massing's article on the Third World {Outlook, Dec. 23} offers us more of a polemic, supported by untypical examples, than a balanced view.

Certainly, "capitalism" is not a simple answer to all the Third World's problems. As developing countries turn toward market-based policies, they do need to think carefully about how to curb the excesses of capitalism. And no one can deny that governments still have an important part to play, including responsibility for the provision of infrastructure.

But I strongly believe that market-based policies do hold out new hope for the Third World. In most of the Third World, these policies have been in operation for only a short time. During the 1960s and '70s and well into the 1980s, most Third World countries were still following policies based on a high degree of government control and protection. The failures of those policies became increasingly obvious. The recent change to new policies is already producing benefits.

The "four tigers" {Singapore, Hong Kong, South Korea and Taiwan} are by no means the only successes in the developing world. Mr. Massing makes no mention of Indonesia, Malaysia, Thailand, Turkey, Mauritius or Chile, which have achieved rapid rates of growth under market-oriented policies in the last few years. Latin America has of course been under the cloud of the debt crisis for most of the past decade, but besides Chile, Mexico is emerging and now gaining the benefit of the kind of capitalist policies that Mr. Massing says are not working.

As for agriculture, the view Mr. Massing puts forward, as if it were new, has in fact been the conventional wisdom for a couple of decades. The development literature during that time has been full of discussion of the need to get agricultural incentives right; and in fact, policies of this kind have been followed with dramatic success in many countries, especially in Asia, where there is a food surplus in most countries.

In the Third World, as elsewhere, the market works -- imperfectly, yes, but it works. WILLIAM RYRIE Executive Vice President International Finance Corporation Washington