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Mystifying the Concept of Capital: Hernando de Soto's Misdiagnosis of the Hindrance to Economic Development in the Third World
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The Independent Review
- Article date:
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July 1, 2008
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Copyright informationCopyright Independent Institute Summer 2008. Provided by ProQuest LLC. (Hide copyright information)
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In his well-publicized book The Mystery of Capital (2000), Hernando de Soto claims to have discovered the explanation for poverty in countries of the Third World and the former Soviet Communist bloc. He claims it is the inability of the poor people in these countries to convert their "dead capital" into live, functioning "capital" because of a "legal apartheid" their governments have created. He asserts that the conversion of dead capital into live capital explains the rise of capitalism, which he equates with economic development, in the West. Numerous reviewers of the book have praised de Soto's diagnosis of the cause of underdevelopment and his recommendation of the widespread granting ...
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