Why Third-World Capitalism is Not Flourishing
Here’s a quick statement of the reason, from my notes on the subject:
The mystery of capital is this: Assets (property, money, the means of production) are not automatically capital. Capital is like electricity. Until it is there, the assets are dead. Property rights are what close the circuit and bring dead assets to life. This is chief reason third world capitalism is not flourishing.
This is the premise of the book The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else.
De Soto’s book has revolutionized our understanding of capital and “points the way to a major transformation of the world economy.” According to The Economist, it is “the most intelligent book yet written about the current challenge of establishing capitalism in the developing world.”