The Mystery of Capital
A renowned economist's classic book on capitalism in the developing world, showing how property rights are the key to overcoming poverty "The hour of capitalism's greatest triumph," writes Hernando de Soto, "is, in the eyes of four-fifths of humanity, its hour of crisis." In The Mystery of Capital, the world-famous Peruvian economist takes up one of the most pressing questions the world faces today: Why do some countries succeed at capitalism while others fail? In strong opposition to the popular view that success is determined by cultural differences, de Soto finds that it actually has everything to do with the legal structure of property and property rights. Every developed nation in the world at one time went through the transformation from predominantly extralegal property arrangements, such as squatting on large estates, to a formal, unified legal property system. In the West we've forgotten that creating this system is what allowed people everywhere to leverage property into wealth. This persuasive book revolutionized our understanding of capital and points the way to a major transformation of the world economy.
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- This is well documented in the the book "The Mystery of Capital" by Hernando de Soto. When it was published I thought it would change the world, but apparently nobody cared. :-)
In his thesis, this is the reason capitalism cannot work well in Latin America and other nations around the world. He says that registered land ownership is the foundation of capitalism. This is how one can borrow money against your land and invest it to make more capital. Very common for example with farmers in N. America to borrow against their farm, for machines, seeds and fertilizer.
(I am not an economist)
- I would highly recommend this book by Hernando DeSoto, The Mystery of Capital.
GBooks link: https://www.google.com/books/edition/The_Mystery_of_Capital/...
- In my view, the most important book is missing from that list:
De Soto, Hernando. The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else. Basic Books, 2000.
It shows by experiment and historical analysis, that there's a clear pattern to explain the gap: the legal institution of property being accessible and affordable to everyone, not just the privileged or rich. And if that's introduced, things can change around quickly.
- There is an excellent book a Peruvian economist Hernando de Soto, The Mystery of Capital, that discusses these issues. He has a chapter on the number of steps it takes to open a business in Hati and Singapore (if memory serves me correctly). Hati requires thousands of steps and if done correctly 17 years to open a business legally. Singapore take a few steps and less that a week to open a business legally. This has broder implications to property rights and if countries prosper.
- To me, this question has been answered long ago by the book The mystery of Capital (2000) by Hernando de Soto.
The conclusion is, that the administrative and judicial system needs to work for the poor, too; and there needs to be a process that is somewhat practical to go from black/ gray economy to fully legal status.
He and team did historical research how that process was very similar in all countries now rich; and showed by experiment that same process is a rich privilege, or extremely costly and inefficient for everyone else (often due to hesitation to overturn nominal property rights in conflict with factual reality). The experimental study was done in a number of countries in the so called developing world, Egypt, Peru, Malaysia among them iirc, covering quite distinct cultural backgrounds, and consisted in following real life cases (over many years).
- Developing countries lack proper legal system where laws are based on property rights and market economy. That's why mentality of African people for example can not change and can not embrace capitalism.
I would suggest you to read Hernando De Soto - The Mystery Of Capital: Why Capitalism Triumphs In The West And Fails Everywhere Else
The book argues "it actually has everything to do with the legal structure of property and property rights. Every developed nation in the world at one time went through the transformation from predominantly informal, extralegal ownership to a formal, unified legal property system. In the West we've forgotten that creating this system is also what allowed people everywhere to leverage property into wealth." [1]
Book is in the public domain: [1] https://archive.org/details/Hernando_De_Soto_The_Mystery_Of_...
Once the China for instance embraced capitalism and changed their legal system to allow private property ownership and allow market economy they thrived. Plus allowing American companies to come and exploit cheap work force they acquired "know-how" by now widely known and familiar stealing of intellectual property and copying literally everything they put their hands on.
