The Power, Rigour and Efectiveness of an Idea: the case of the poor's legal informality

Few ideas and activities have received as hyperbolic praise as those presented by Hernando de Soto on informality. Nobel prizes in economics, presidents of various countries, important magazines, and multilateral organizations have endorsed this author’s impulse to the official registration of the poor’s property, particularly, their homes, as the key to launch a worldwide economic revolution from below. In this paper we present the institutional backing of those ideas, the analytic substance of the main arguments involved, the descriptive accuracy of the institutions operating in the Third World, and the results of their application. In this way, we evaluate the relation between the spread and power of an idea with its formal content, and its effectiveness to change the world of the poor.

Keywords

Informal sector, Developing countries, Poverty, Land tenure

JEL Classification

O17, Q24, P16