The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else

Front Cover
Basic Books, 2000 - Business & Economics - 275 pages
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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LibraryThing Review

User Review  - ShadowBarbara - LibraryThing

Excellent overview of how we use property to create capital and how most of the world does not have a system for documenting ownership. Most people live in an extralegal system. Has recommendations for changing the systems so that real capitalism can work. Read full review

LibraryThing Review

User Review  - Akiyama - LibraryThing

Hernando de Soto is a Peruvian economist. In this book, he provides an answer to the question of "Why capitalism triumphs in the West and fails everywhere else". The answer is that in third-world ... Read full review

Contents

The Five Mysteries of Capital
1
The Mystery of Missing Information
15
The Mystery of Capital
39
The Mystery of Political Awareness
69
The Missing Lessons of US History
105
The Mystery of Legal Failure
153
By Way of Conclusion
204
Notes
226
Acknowledgments
238
Appendix
246
Index
256
Copyright

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About the author (2000)

Hernando de Soto is President of the Institute for Liberty and Democracy (ILD), headquartered in Lima, Peru. He was named one of the five leading Latin American innovators of the century by Time magazine in its May 1999 issue on "Leaders for the New Millennium." De Soto played an integral role in the modernization of Peru's economic and political system as President Alberto Fujimori's Personal Representative and Principal Adviser. His previous book, The Other Path, was a best seller throughout Latin America and the U.S. He and ILD are currently working on the practical implementation of the measures for bringing the poor into the economic mainstream introduced in The Mystery of Capital. He lives in Lima, Peru.