Uploaded March 2026 | Updated September 2026, 2 weeks ago
Why do some countries turn effort into prosperity while others do not?
Learn more: fee.org/articles/hernando-de-soto-how-to-make-the-third-world-richer-than-the-first/?utm_source=youtube&utm_medium=social&utm_campaign=fee-online
Peruvian economist Hernando de Soto drew attention to an uncomfortable question: why has Latin America struggled to take off despite its clear entrepreneurial dynamism? His answer does not point to culture or a lack of talent, but to weak institutions.
When property rights are not clearly defined or protected, millions of assets remain trapped in informality. Homes, land, or small businesses exist, yet they cannot be transformed into capital because they cannot be used as collateral to access credit.
Without that gateway into the financial system, scaling up becomes almost impossible. As a result, different regions follow divergent development paths not because of a lack of initiative, but because legal frameworks either integrate citizens into the formal economic system or leave them outside it.
Why do some countries turn effort into prosperity while others do not?
Learn more: fee.org/articles/hernando-de-soto-how-to-make-the-third-world-richer-than-the-first/?utm_source=youtube&utm_medium=social&utm_campaign=fee-online
Peruvian economist Hernando de Soto drew attention to an uncomfortable question: why has Latin America struggled to take off despite its clear entrepreneurial dynamism? His answer does not point to culture or a lack of talent, but to weak institutions.
When property rights are not clearly defined or protected, millions of assets remain trapped in informality. Homes, land, or small businesses exist, yet they cannot be transformed into capital because they cannot be used as collateral to access credit.
Without that gateway into the financial system, scaling up becomes almost impossible. As a result, different regions follow divergent development paths not because of a lack of initiative, but because legal frameworks either integrate citizens into the formal economic system or leave them outside it.
