1: Institutional Change
Help developing countries make fundamental institutional changes regarding their property and business environments, encouraging
people to enter the legal system and offering them as an incentive those essential legal tools that will not only improve
their lives and businesses, but also help them transform their society
Other Information:
The ILD’s remedy is to help developing countries make fundamental institutional changes regarding their property and business
environments, encouraging people to enter the legal system and offering them as an incentive those essential legal tools that
will not only improve their lives and businesses, but also help them transform their society: fungible property rights, forms
to organize their businesses and mechanisms to access expanded markets, nationally and internationally. Clearly, this is no
easy task; nor can it be done from behind a desk. Fundamental institutional reform requires the kind of unique experience
the ILD has accumulated over decades and that has given us a new and powerful way of examining a developing economy –to see
what works and what doesn’t, what practices have to be scrapped and what can be built upon. Extralegality does not stroll
up to a stranger in a shantytown of the Third World with a smile and a handshake. Our researchers go into the field, digging
into a client countries’ legal and extralegal economies to findout what works and what doesn’t –from the point of view of
the ordinary property owner and entrepreneur excluded from the system. MERGE... ...TWO PARALLEL ECONOMIES They have to find
the right agents willing to talk or to make introductions to people who will be helpful; researchers have to be experienced
detecting not just extralegal property, buildings or businesses but also the invisible practices and social contracts that
allow the denizens of this parallel economy to build and protect those assets. The ILD’s fieldwork thus requires a practiced
eye to identify extralegal economic activity where others will see only chaos and illegality –much like the experienced paleontologist
who can detect the fossil remains of a dinosaur where the rest of us see just another pile of rocks. Only with such information
in hand are we in a position to create institutional reforms that will merge these two parallel economies into one enhanced
legal framework for a modern economy –an inclusive public memory system that will welcome all citizens who want a stake in
it, including the poorest. And because this new legal framework will involve norms and practices familiar to the extralegal
ones, they are more likely to give the new system a try. This bottom-up approach to reform, based on extralegal institutions,
is what separates the ILD from the hundreds of service, equipment, and “consulting” companies trying to help countries improve
their business environments. Their common denominator is a tendency to seek documentation for property or businesses that
are already part of the formal economy.
Objective(s):
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