Tag: Hernando de Soto

Poverty and Property Rights

 

On my first trip to Ethiopia seven years ago, I took along a copy of Hernando de Soto’s book The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else. I chose well. De Soto’s treatise on the primacy of property rights in fostering economic development provided a framework for understanding the dysfunction I saw in the slums of Addis Ababa.

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I vividly recall one house call to an HIV patient–we will call her Abebech–who lived in a “moon village,” so named because the hamlet sprouted one night on vacant land earmarked for a sports complex. The authorities blustered but never got around to demolishing the settlement, and so it grew, eventually to thousands of residents. Abebech warmly welcomed me to her house, an eight-by-six foot room with walls of dried mud she rented for $17 per month. Once we got through introductions and the state of her health, I asked what concerned her most.