Barrios and clear title

[LUDUS]

The Peruvian economist Desoto in his book "The Mystery of Capital" argues that the poor throughout the third world own a lot of property but cannot use it as capital because the legal foundations for clear titles to the land and businesses they own have not been established. My impressions of the RD on a couple of visits support his ideas. Anyone have insights on the staus of barrio real estate holdings/ small business in RD? Can a colmado owner run a legal fully registered business or does the regulatory tangle put barrio business outside the law? What kind of title do people with tin roof shacks have? If they move up to building a solid little house (as I saw many people doing), does the legal system protect their investment in the property or is ownership held outside of regular channels?

[Fabio J. Guzman]

De Soto's ideas on the importance of empowering the poor by providing them with marketable title over their property have been around since the publication in the late 1980's of his bestseller El Otro Camino (The Other Path).

It is a fact that most poor inhabitants in Latin American cities do not have legal title over their dwellings and cannot therefore use it as collateral for business purposes. There are two main reasons for this: first, because most of the poor build their houses as squatters; and second, because even when there is a purchase from a legal owner with proper title, the procedure and expense involved transferring title is beyond the pockets or the understanding of the buyer.

The present administration seems to be aware of the benefits of titling the property of the poor in the slums. Bienes Nacionales started a program last year which provides for a relatively simple mechanism whereby squatters on government property can obtain title to the land on which they have built their houses.