Bringing Capitalism to the Masses

In this excerpt of his remarks delivered upon receiving the Milton Friedman Prize for Advancing Liberty, de Soto discusses the effort to promote capitalism in developing countries, where the greatest constituency for change, he states, is poor businessmen and entrepreneurs. The vast extralegal economies in countries such as Mexico and Egypt provide the potential to generate wealth, but will do so only when their strength is harnessed by capitalism. De Soto emphasizes the importance of property rights, “the result of a grassroots contract,” which “stick even when sovereignty fragments.” When individuals are granted property rights, interest grows in the reliability of the courts to defend those rights, and as a result, in the reliability of the government that creates the courts as well.

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