Rule of Law Promotion, Land Tenure and Poverty Alleviation: Questioning the Assumptions of Hernando de Soto

Abstract

In this article I will first present the main thrust of Hernando de Soto's design, and then summarize praise and criticisms of his work. Next, I will address the question of to what extent De Soto's design is innovative. To this end I present a brief overview of past experience. I will then introduce some preliminary results of an international Leiden-based research project that has addressed the general causal relations between legalization, tenure security and poverty alleviation which constitute the basis of De Soto's argument. Most case studies of this project found that for De Soto's plans to be effective, a range of conditions had to be fulfilled. As long as these conditions are not fulfilled – which happens to be the unfortunate reality throughout the developing world – his plans will not work. Unfortunately, his proposals then are based on a whole set of unrealistic assumptions. Finally, in order to place De Soto's work in the context of today's development policies, with their emphasis on good governance and rule of law promotion, I will present a conceptual scheme which unpacks the key concepts of development, governance and the rule of law. In the concluding part I speculate on what we can learn from the success of De Soto's compelling theories, and from various criticisms of and responses to them How can these lessons be beneficial for a realistic rule of law promotion?