Hernando de Soto Polar, a Peruvian economist known for his work on the informal economy and on the importance of business and property rights, in his book El Otro Sendero (1986) (published in English in 1989 as The Other Path) argues that excessive regulation in the Peruvian (and other Latin American) countries forced a large part of the economies into informality and thus stifling economic development.

While accusing the ruling class of the 20th century mercantilism; an economic theory and practice that focuses on governmental regulation of a nation’s economy, de Soto admires the entrepreneurial spirit of the informal economy.

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