Hernando de Soto: How To Make the Third World Richer than the First
In this week’s Friday video, our good friend Nick Gillespie interviews Peruvian economist and property rights activist Hernando de Soto about the future of prosperity in the developing world, and how legal reform can be the path to wealth for traditionally impoverished communities around the globe.
The video above starts with Nick’s narration of how de Soto’s idea first came to international prominence:
In the spring of 1989, Chinese students occupied Tiananmen Square, erected a replica of the Statue of Liberty, and called for democracy and individual rights. By the fall, people living in East Germany took hammers and chisels to the Berlin Wall, unleashing a wave of revolutions that ultimately led to the collapse of the Soviet Union. It was an auspicious year for human freedom.
Nineteen eighty-nine was also the year that Peruvian economist Hernando de Soto published “The Other Path: The Invisible Revolution in The Third World,” which radically challenged conventional wisdom about the underlying cause of persistent poverty in the post-colonial landscape. Drawing on his extensive field work with the Peruvian-based think tank the Institute for Liberty and Democracy, de Soto argued that people were pushed into the black market and wider informal economy because governments refused to recognize, document, and promote legal ownership of land and other assets.
We at CEI were very happy to award de Soto the Julian L. Simon Memorial Award at this year’s big annual gala on June 28th. See his acceptance speech below.