Property rights for the world's poor could unlock trillions in ‘dead capital’. According to one economist, the value of extralegal property globally exceeds 10 trillion dollars.
Ensuring property rights for the world's poor could unlock trillions in ‘dead capital’. According to Peruvian economist Hernando de Soto, the value of extralegal property globally exceeds 10 trillion dollars. Nobody has ever disputed that property rights matter for investment: experts point to a direct correlation between a nation’s wealth and having an adequate property rights system. This is because real estate is a form of capital and capital raises economic productivity and thus creates wealth. Mr de Soto's understanding – that title frees up credit, turning ‘dead capital’ into ‘live capital’ – has prompted governments in other countries to undertake large-scale property-titling campaigns.
Voting for the 51st Thing has now closed. The winning “thing” will be revealed on Saturday 28 October 2017.
Producer: Ben Crighton
Editors: Richard Knight and Richard Vadon
(Image: Hernando de Soto, Credit: Getty Images)
Sources and related links
Hernando de Soto - The mystery of capital, New York: Basic Books, 2000
Christopher Woodruff - 'Review of de Soto's The mystery of capital', Journal of Economic Literature Vol 39, December 2001
The World Bank Group - Doing business in 2005
Robert Home and Hilary Lim - Demystifying the mystery of capital: Land tenure, London: Glasshouse Press, 2004
Tim Besley - 'Property rights and investment incentives: Theory and evidence from Ghana', Journal of Political Economy