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  • The 2017 Global Award for Entrepreneurship Research goes to Hernando de Soto

    The 2017 Global Award for Entrepreneurship Research goes to Hernando de Soto

    The Global Award for Entrepreneurship Research is the most prominent international award in entrepreneurship research with a price sum of EUR 100,000. De Soto’s analyses have had tremendous influence on policy throughout the world and were a main source of inspiration for the World Bank’s Doing Business program. Read More
  • 2017 Award Winner

    2017 Award Winner

    Hernando de Soto Peru  Institute for Liberty and Democracy For developing a new understanding of the institutions that underpin the informal economy as well as the role of property rights and entrepreneurship in converting the informal economy into the formal sector.   Read More
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One of the more provocative applications of the blockchain is its potential to unlock undocumented value in the developing world. Peruvian economist Hernando de Soto, whose book The Mystery of Capital is often cited on this topic, has asserted that 5 billion people lack access to adequate record-keeping infrastructure such as land titles, resulting in over $10 trillion in assets susceptible to unlawful expropriation and corruption. De Soto evocatively refers to these assets as "dead capital."

 But what about "dead" labor? Workers in the developing world (and beyond) are vulnerable to the misrepresentation and underreporting of their labor. This form of cost externalization, which has obvious economic, social, and environmental consequences, could be addressed with a blockchain solution. Using a tool like Factom, a worker’s labor contribution could be encoded immutably on a blockchain, effectively ensuring that the finished goods associated with that labor bear the imprint of the true cost of their production.

Similarly, the blockchain could be used to create a public record of adherence to regulatory standards as a product moves through a supply chain. For instance, Fairtrade International has stringent record-keeping requirements which could be better managed and audited on a transparent, blockchain-based platform. Going further, with such a system in place, consumers could independently verify that the premiums they pay for Fair Trade products are actually being used for social good. Taken to its logical conclusion, this type of blockchain implementation amounts to something like digital DNA, in which a product’s genesis is forever etched into an unalterable record.

Coming full circle, the blockchain could ultimately serve as a better technical architecture for the internet itself. Recent attacks on the internet’s core infrastructure are reason enough to begin assessing how an alternative approach might outperform our current systems, and organizations such as NameCoin are already experimenting with a blockchain-based DNS system that could replace our vulnerable, centralized model.


Read the full article on the website of Co.Create

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