Why Capitalism Triumphs but Fails Elsewhere

Abstract

This paper emanates from the occasional papers produced by the Centre for Development and Enterprise in November of 2001. It is basically a South African conversation with Hernando de Soto. The paper therefore, is a synopsis and summary of this important conversation. It bears immense relevance to development, entrepreneurship, the economy, politics, business, money, ownership, governments, states and the poor, including a host of other social issues. The paper is therefore, important to the management student, to the business environment, the success of governments and their failures, and to society as a whole, given the economic crisis that began in 2008 and, persists even today. It does not add to the debate, but exemplifies the importance of this discussion to contemporary society and to the developing world. The author uses his own insights, observations and experiences as a South African, born over six decades ago in the city of Durban, in the province KwaZulu – Natal, to add to the conversation. Hernando de Soto is the founder and president of the Institute of Liberty and Democracy in Lima, Peru. He was involved in Peru’s economic reform and was an advisor to the President of Peru. His current work is on the implementation of measures for bringing the poor into the economic mainstream. He has published the book – The Mystery of Capital: Why Capitalism Triumphs in the West and Fails everywhere else. In 2001, de Soto spoke at a seminar in Johannesburg, South Africa, hosted by the Centre for Development and Enterprise. The author is mindful of the reality that such an article can be provocative and will be criticized. The idea is not to antagonize anyone, but to add to this important conversation. No apology is therefore made. The paper therefore is relevant to a host of societal issues, including politics, public administration and the economy.