Rating: 
Summary: Interesting but often repetitive
Review: The premise of this book is in my opinion solid. I enjoy books which go directly to the point and this book certainly does that. The author quickly exposes the basic problems of non-western countries, which arise from a lack of recognisable, standardised and transferable rights and proof of ownership. However, many arguments and facts (it takes years to register a business in those countries) are repeated throughout the book. After reading every word of the first chapter, I realised that I could skip entire paragraphs without losing the thread of the argument. Two other features annoyed me: I thought the font was deliberately large to make the book longer and entire legal documents were inserted. These documents would have made fine footnotes; instead, several paragraphs where shown where a few, carefully selected sentences would have sufficed to prove a point. Therefore, the length of the chapters was increased yet little or no relevance was gained by the reader. To sum up, the book will offer you an interesting argument but it was either unnecessary to make it that long, or should have included more varied, but succint, examples.
Rating: 
Summary: The Mystery Explained
Review: The debate has raged for nearly two centuries: Is capitalism the answer or the problem? Rather than rehashing the arguments of either side of the political spectrum, Hernand de Soto has changed the nature of the debate by asking a different question: Why does capitalism apparently work so well in some places and so poorly in others? The author and his colleagues didn't treat this question as a mere intellectual enterprise, but went into the field - the burgeoning underground economies of the Third World - to find the answer. And the answer they found was deceptively simple. The problem, he argues, is not capitalism, per se, but inadequate property systems either through the inability of law to keep up with economic reality or counterproductive regulation. Inadequate recording systems, limitations on commercial activities and barriers to entrepreneurship in developing and former communist countries prevent the use of assets to generate growth capital that is identifiable, transferable and able to grow. The book is easily approachable and not too overlong (the text is a mere 228 pages, including charts). It spells out the author's thesis clearly in the first chapter. In later chapters he discusses the historical evolution that occurred in the United States that has allowed "dead" capital to be brought to life to the benefit of all and the steps that must be undertaken to achieve such a system in the developing and former communist countries. Be warned, however, (and this is the reason why the book doesn't get 5 stars) that the second and third chapters are needlessly (and annoyingly) repetitive, covering the same ground over and over again, often using the same words. The first three chapters might easily have been boiled down to one. But persevere. The remaining chapters are worthwhile.
Rating: 
Summary: A real eye-opener
Review: Hernando presents a clear explaination of why capatilism fails in developing countries, and what is required for capatilism to succeed. He says that the lack of a law structure prevents the creation of capital from the real estate the "poor" posses. With a clear law and property foundation the poor wouldn't be so poor, they own real estate that could be mortgaged against and so. Being now extra-legal they are out of the system, out of the "bell jar" and can't get most of capatilism benefits. I found the book clearly written and a real in-depth eye-opener.
Rating:
Summary: GREAT BOOK
Review: This is an excellent book that zeroes in on a fundamental roadblock to development in the 3rd world and former communist countries. There are too many book out there with claims on how things should be done. IMF should have done this, World Bank Screwed up here... bla bla bla. Of course there is room for such criticism and analysis, but De Soto's book is really refreshing because it basically says: Let everyone onto the field, and the refs won't matter that much. With access to legal property rights, the poor (and the kinda poor, and the not-so-poor.. whoever doesn't have the right to legal property) will be able to improve and protect their homes and businesses and spur economic growth. Contrary to the assumptions of many patronizing and condescending westerners, the world's poor are far from lazy and pathetic, and with adequate property rights and trade conditions, they wouldn't need our help, and we wouldn't be writing books on the subject. Wether you are a socialist or a die-hard capitalist, the common sense of providing accessible legal property rights available to all people will appeal to people across the entire political/ideological spectrum (except for maybe anarchists and die-hard communitsts but every those guys could benefit from reading this book). The sections on the formation of property rights system in Western Europe and the United States is a little tiresome, but other than that, The Mystery of Capital is a very readable book, and I would highly recommend it to anyone interested in international development. Buy it and read it!
Rating:
Summary: Food For Thought
Review: The last book I read by an economist was over thirty years ago. The book, Das Kapital by Karl Marx, pretty much did me in at wanting to read writings by an economist, so I wasn't sure what to expect when I began this text by Hernando De Soto. I was pleasantly surprised at both how readable it was and the simple power of what is being said. Having earned a Masters in Management with a specialty in International Development, I have to admit at being surprised that I could have missed something so basic as the need to legitimize underground economies, the value of property ownership, and the ability to leverage property ownership, thus creating capital and capital in turn being the life blood of capitalism. My hat is off to Hernando De Soto and I recommend this book to anyone who cares about the problems of the other two thirds of the world. I especially want to recommend it to people involved in International Development. I have already contacted some of my grad school professors to alert them to this work. I believe that it has serious value in the academic world as a means to create talking points and challenge long held views. If you are looking for answers to one of our planet's more lingering problems (why well meaning International Development efforts continue to fail despite the billions of dollars we pour into them), read this book!
Rating:
Summary: A decent but uncomplete proposal.
Review: The integration of the extralegal/dead capital into the economic and legal systems of the third world and former communist countries is a known and a very controversial problem. The obstacle that most of these countries run into is that most of the dead capital is generated from from illegal activities (such as drug and arms trade, human trafficking, prostitution, etc..) that can not ever be integrated into the formal legal and economic system.
Rating: 
Summary: Mediocre
Review: I would have given 3 stars to this book but coming from a recognised economist as Hernando de Soto I give it only two. Although the book explains in what consists his proposal for the development of the third world, he repeats his idea too much through out the chapters. The examples and methods mentioned didn't satisfy my curiosity for his theory. The book looks more a marketing scheme for selling his idea, which isn't a bad thing, but considering the seriousness of the theme, I would have expected a more professional layout. After reading this book,go and buy The Myth of Development : Non-Viable Economies and National Survival in the 21st Century, written by Oswaldo de Rivero, a peruvian as Hernando de Soto. Although not advertised as The Mystery of Capital, it has a better book structure and an excellent analysis of the world's current situation and ways to solve it.
Rating:
Summary: de Sota supplies one component for economic growth
Review: The Mystery of Capital attempts to "reopen the exploration of the source of capital and thus explain how to correct the economic failures of poor countries." I believe the author makes an interesting argument within the book concerning the failure of capitalism to catch on in developing and post-communist countries. His argument deals with institutions we here in the West take for granted-property rights and other legal institutions. The connection between these legal institutions and economic growth is clear-and de Sota is clear on this point as well. He states that an individual living outside the West faces an impenetrable wall of rules that bar them from legally established social and economic activities-such as deleterious bureaucracies that retard growth by wielding red-tape. De Sota sent teams to Peru, the Philippines, Egypt, and Haiti and they experienced firsthand how it takes several years to obtain legal verification of assets-years compared to days here in the West. Under these burdens, individuals create new laws-extralegal laws. These social contracts have created a vibrant but undercapitalized sector. This sector is known in economic layman's terms as the underground or informal economy. The author estimates that over half on the inhabitants in developing countries engage in this sector-using Dead Capital. The value of the assets in the informal markets are huge-surpassing the assets of rich countries sometimes. De Sota has brought attention to the core of the problem-he then states that the solution can be found at the heart of the countries. He supplies the formula to fix the backwardness of the nascent capitalist nations. The first objective is to unify the many social contracts already existing in the extralegal sector into one, all encompassing social contract-by listening to the "barking dogs", or the people. Past attempts with this aim have failed because they have lacked the legitimacy and support from the current extralegal world. De Sota creates a bridge to fix this dilemma-a bridge that integrates old social property customs into a new all encompassing social contract. By working with their people, government leaders can forge a new regulatory framework. The second task is a task of a political nature because the plan outlined above requires the support of the poor, the elite, and the lawyers. The poor will gain the most because they will greatly increase their economic lifestyles with a more unified social property system that will enable them to use their assets as full functioning capital. The elite will harvest gains as well; they will benefit from an expanded market and growing capitalist economy. The lawyers must not use the current law, but instead fine-tune the law and change it to make it work for all. De Sota's real world studies and solutions make sense in my mind. He identified a problem and supplied the solution. He may fall short though in his solution because a complex capitalist economy requires much more infrastructure than only property rights-of course I mean other forms of capital, such as human capital. By De Sota is on the right tract; a capitalist economy demands strict and discrete property laws that enable individuals to utilize their assets. His premise is right-under capitalism, the rich get richer, and the poor get poorer. In the third world, the poor don't have access to their assets, and they thus flounder in the extralegal sector.
Rating:
Summary: Revolutionary, Timely, Important: In Time to Save The World
Review: Hernando de Soto, a Peruvian citizen who runs "the second most important think tank in the world" according to the Economist magazine and who has consulted with numerous governments around the world, including Peru, Egypt, Mexico and the Philippines, has a profound, timely, and deeply researched (e.g., extensive studies of virtuually every square mile of Egypt, Peru, the Philippines and of the bueaucratic and legal hurdles to property rights therein) study of the key to successful economic development and liberation of the poorer nations of the world from poverty, hopelessness and powerlessness. This book is perhaps the most important book of the early 21st Century. As one who has travelled in and sometimes lived in over 66 countires, his thesis absolutely correlates with and rings true with what I have observed with my own eyes: there is a universal human aspiration to home ownership and people do amazing things with property which they own, I know because a close relative of mine, with his host country national partners, built hundreds of thousands of homes in the 50s and 60s which are privately owned by a small emerging middle class in Peru, Colombia, Thailand, Taiwan, Morrrocco, Pakistan, Egypt, and other while property not owned by individuals, owned by "the state" tends to be abused, neglected and common ownership (communism) is a predicate for many of the most egregious environmental crimes in the world. (As is the case in Russia with the Siberian oil fields (where we observed "no signs of life; not even birds") and China with their air and water polution; 8 of the 10 most polluted cities in the world, according to the UN, are in the Peoples' Republic of China; I could feel my vitality decline each day I was in China from the air pollution while I was there. The key: legal title to real property, and instituting the "rule of law" in place of "extra-legal" black market sectors of third world economies, which frees up $9.3 TRILLION of "dead capital" estimated to exist in developing nations. Real property title is the basis or foundation upon which virtually ALL "capital formation" for other economic enterprise is built. Surprise: Developing nations have the KEY to their own economis and political problems in their own hands TODAY, but they mustreform and be helped to reform (using their own unique cultural characteristics) their own legal institutions by "formalizing" the reality which already exists in the "informal" sector, i.e., by granting property rights, empowering the "poor" whao have built and often already live in these homes, and by granting legal title to property! Foreign aid and the conventional development economics paradigm of Kofi Anan and other conventional thinkers rewards and tends to perpetuate and reinforce dysfunctional and often corrupt and oppressive regimes, while wasting billions of dollars; Whereas changing legal institutions toward giving individuals property rights of the "poor" by giving them title to their created homes and other real property is the only rational, moral, effective, and efficient path to economic success and out of hopelessness and poverty. Moreover, the estimated value of such "dead capital" -- $9.3 TRILLION dollars ---- in the developing nations exceeds the market value of the top 20 stock exchanges in the world and exceeds 150 YEARS(!) of foreign aid at Kofi Anan's recommended level of .7% of GDP of the developed nations. Finally, through de Soto's vision and specific remedies can the world be purged of the hoplessness, not just the poverty, that are "associated with" (but NOT the sole causes of!) terrorism. De Soto's vital and timely book is a "MUST READ" for any person who cares about TERRORISM, economic and political FREEDOM, the RULE OF LAW, PROPERTY RIGHTS, the elimination of POVERTY, by freeing up of human potential and the liberation of "dead capital" to create new enterprises in the developing world,as well as all who care about INTERNATIONAL RELATIONS, and INTERNATIONAL ECONOMIC DEVELOPMENT!
Rating:
Summary: Whether you agree or not, you will be rewarded.
Review: If you are interested in thinking about what can be done in poor nations to allow the poverty stricken to find their way out of their misery, this book will offer a great deal to think about. It is easy to over simplify the author's argument to saying that it is about property rights. That really isn't it. What he is talking about is the system the wealthy nations have developed that not only protects property with laws, but the confidence that comes with a society of laws. Additionally, property has to be able to be abstracted and capitalized and then bought and sold. Making many able to own a factory via shares and to be able to trade ownership in one thing into cash and then the cash into ownership into something preferable is the real underlying mechanism that allows for simultaneous benefits from trading. It stops being a zero sum game. Both parties are improved. De Soto's thought and argument is more nuanced than his critics allow and his serious concern and energy on behalf of the poor of our world is palpable. Whether you agree with him completely is not as important as your reading and thinking about what he asks you to consider. No matter your political persuasion (unless you are so decided you need no other information), you will be rewarded by reading this book and considering seriously the propositions offered here.
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