Peruvian economist Hernando de Soto, a finalist for the Nobel Prize in Economics in 2002, has the ear of heads of state across the political spectrum as well as impoverished farmers and black-market street vendors around the world. In October, he comes to UNC to discuss his internationally lauded policies advocating property rights for the poor as a solution to global poverty.
De Soto will present the Frank Porter Graham Lecture Oct. 26 at 7:30 p.m. in the Hanes Art Center Auditorium. The lecture, sponsored by the James M. Johnston Center for Undergraduate Excellence in the College of Arts and Sciences, is free and open to the public on a general admission basis. A public reception will follow in the gallery.
De Soto is the president and founder of the Institute for Liberty and Democracy in Lima. The Economist magazine has called it one of the two most important think-tanks in the world.
Through the institute, founded in 1980, de Soto works with leaders and workers in developing nations and emerging democracies to enact institutional reforms that give the poor access to formal property rights and capital. He routinely meets with heads of state and trudges through the streets and fields to talk with black-market traders, factory workers and sharecroppers in Asia, Latin America and the Middle East.
In his best-selling books The Other Path (1986) and The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else (2001), de Soto argues that free enterprise policies have not grabbed hold in developing nations because their leaders have failed to put into place a comprehensive and inclusive property system. The overwhelming majority of citizens may wish to participate in a free market, but without access to property law they cannot get access to bank loans and are forced to operate outside the law.
“They have houses, but not titles; crops, but not deeds; businesses, but not statutes of incorporation,” says de Soto, whose books have been translated in 20 languages.
The amount of “dead capital” in untitled assets worldwide is at least $9.3 trillion, he says, a sum that dwarfs the total amount of foreign aid given by developed nations to poor nations in the past three decades.
De Soto’s institute is credited for developing legal property systems that have moved hundreds of thousands of businesses and real estate holdings from the underground economy into the economic mainstream, and revolutionized the way world leaders address enduring poverty.
In Peru alone, de Soto oversaw some 400 initiatives, laws and regulations that modernized and stabilized the nation’s economy between 1988 and 1995. His reforms gave property titles to more than 1.2 million families and brought into the legal system some 380,000 firms that previously operated in the black market.
De Soto has won praise from Margaret Thatcher and Koffi Annan. Bill Clinton called de Soto “the world’s greatest living economist” and Jack Kemp said he deserved to win the 2004 Nobel Peace Prize.
Time magazine hailed de Soto earlier this year as one of the “100 most influential people in the world.” The Cato Institute awarded him the 2004 Milton Friedman Prize for Advancing Liberty, for making a significant contribution to advancing human freedom. Forbes magazine called him one of 15 innovators “who will re-invent your future.”
Calling do Soto “the poor man’s capitalist,” The New York Times Magazine said that, to the leaders of poor countries, “de Soto’s economic gospel is one of the most hopeful things they have heard in years.”
De Soto’s honors include The Freedom Prize (Switzerland), The Fisher Prize (United Kingdom), the CARE Humanitarian Award (Canada), and The Goldwater Award, The Templeton Freedom Prize, and The Adam Smith Award from the Association of Private Enterprise Education (USA).
“Hernando de Soto’s work embodies the ideals that were so critically important to Frank Porter Graham,” said Randi Davenport, executive director of the James M. Johnston Center for Undergraduate Excellence in the College of Arts and Sciences, which sponsors the lecture. “We could not imagine anyone better suited to launch a lecture series intended to advance our understanding of poverty and its sufferers.”
The Frank Porter Graham lecture series honors the late U.S. senator, class of 1909 alumnus and president of the University who was a champion of freedom, democracy and the disadvantaged. The lecture series is made possible by the gift of Taylor MacMillan ’62. Additional support for the 2004 lecture was provided by the UNC General Alumni Association.