Source: Hernando de Soto: The missing ingredient - What poor countries will need to make their markets work. The Economist 11.Sept. 1993, pp 10, 13, 14 within the article: The future surveyed.

A recent presentation of and interview with Hernando de Soto is available from the magazine The Region June 2001, Volume 15 Number 2.

Extracts from the article: Values | Facts | Hypotheses | Actors | Selected concepts
My answers to the following questions:

• The main message of the article
• The values of the article
• The instruments/means mentioned
• The role of professions suggested
• The added skills I would need
• The local information I would ask for

All nations to all times have markets

Some 25 of 185 nations have a market economy (including property economy)

In US family ownership of land account for more than 40% of family assets; in developing contries it may be 70%.

In Peru formalized title to squatters increases investment in property ninefold.
Formalized title is used as collateral for mortgages, opens for credit.

Property ownership in France is recalled as a triumph over feudalism
German peasents gaind ownership as a tactics to insulating them from effects of French revolution

US homesteaders got title to support expansion of territory

In some Asian countries formalization of property was a means to contain communism and weaken local elites.

Property rights are inscribed in nearly all constitutions

Informal property law has been consolidated much quicker

In Latin America land was expropriated and given to poor farmers.

$ 9 billion is spent on surveying and mapping each year, largely in countries with formalized systems

Common law practises involves citizens (14L)

I have learned .. that the legal profession may well .. be the most vigorous opponent to efforts to formalize property rights (14R)

Formalised title give owners incentive to invest their intelligence and work to improve it (soil, ..)

Formalized title gives longer planning horizon (planting trees,..)

Formalised title give owners incentive to support environmental protection, reduce erosion, garbage collection

Connection between property rights and market development has been overlooked

The transition to formalized property was unpremediated; the developed world stumbled into it

The energy of the explosion of illegal cities of the past 50 years may be channeled into prosperous market economies, if property (rights) are formalized

Governments can make the law coinside with the way people live and work

Land reform in Latin America failed because collective units were broken up into small, individual de facto holdings, where individual rights were not formalized.

More surveying and mapping does not cure the informality problem.

A single governmental unit may improve the situation

Decentralised units may improve the process
 

Change wil have to come from outside the legal profession, but they must take part.. (14Ln)

A deliberate political decision, made at the highest political levels, will trigger a revolutionary change

A top priority of an issue on the .. agenda will solve the issue/ reduce the problem

• International agencies
• Capitalist nations (try to export market-economic systems to the rest of the world)
• Antropologists (study cultures)
• Leaders (fail to grasp implications of informality)
• Governments (may make the law coinside with the way people live and work)
• Governmental departments (have diverse responsibilities, no single unit)
• Latin jurists (spend their time with exegesis, apply law to documents, not to people)
• Legal profession (may turn out to become vigorous opponents to formalisation/ change)

Legal system (in Britain)

Property rights

Property rights in land includes

• the support of legal system to exclude others claimants from ownership

• Does the seller own the land and have the right to transfer it?
• Location of property boundaries ?
• Proof relative to legal system who is the owner ?

"The problem that has to be faced .. is that most rights .. are defined by informal law, and formal law has no way to connect with them.  .. Laws that could help .. are burdensome because they incorporate requirements unrelated to the certification of ownership. ( p. 14 L)

[Problems occur as long as] ..the law [does not] coincide with the way people live and work (p. 13R)

Transaction cost theory applied for understanding means to reduce transaction costs

Who are the actors ? (Governmental departments, professional associations, main companies in mapping, computing, property market operations, municipal associations, or municipalities with high administrative reputation (among peers), building societies, ..

What was the last involvment by government(al department) ? Goal, resources, actor network, outcome, explanations why

What is the profile of (academic) professions concerned ? What kind of 'instruments' can be handled by routine ?

What is going on in an ordinary town in a not too wealthy region ? and what is going on in the 2-4 largest city in a wealthy region ? (Dont ask what is going on in the capital, you cannot infer the situation in the country from that)

And you have to find out: Who is my counterpart here ? and in what respects can I rely on him/her ?