Why it's too hard to start a business in Africa -- and how to change it

George Ayittey is responsible for calling attention to the fact that the dictatorial regimes of Africa, with their constricting economic policies, are the product of European ideas and colonialism. Indigenous Africa was characterized by long-standing traditions of markets and trade. It was only through alien Marxist ideas, learned at European and American universities, that African leaders constricted the native entrepreneurial traditions of Africans and created long-lasting poverty. Ayittey outlines a return to indigenous African traditions of economic freedom and a repudiation of the damaging legacy of European Marxism.

Why is it that many developing nations have not become prosperous through capitalism? Hernando de Soto, a Peruvian economist who was working on the ground in Peru for decades, discovered just how difficult it was for indigenous entrepreneurs to launch businesses. First in Peru, and then in developing nations around the world, he discovered and documented the obstacles to business that later inspired the Doing Business index. He is better known as an advocate for property rights in developing nations, a theme which he also develops in this book. But the whole picture includes both the need for the poor to have formal title to their property as well as the absurd obstacles to business globally. Discover why Bill Clinton described de Soto's organization as the world's leading anti-poverty organization!

Is Somalia poor and war-torn because the US and the UN have imposed a nation-state structure on a society that already had a functional non-western legal system? Author Michael van Notten was a Dutch legal scholar who married a Somali woman and then lived his last years in Somalia. He learned about traditional Somali clan law from the inside and discovered a remarkably sophisticated legal system based on customary law, which he termed "kritarchy" — rule by judges, with some similarities to the British common law legal system. Whether or not one agrees with this book, it is the only book I know that takes indigenous African legal systems seriously. The book concludes with a fascinating proposal by anthropologist Spencer MacCullum on how to graft modern commercial law onto traditional Somali law to provide a foundation for a commercially successful Somalia.

Kudos to Bill and Melinda Gates for continuing their long-term commitment to poverty alleviation.

A fundamental measure of the ease of doing business in nations around the world. For each nation evaluated, the index looks at how challenging it would be for an indigenous entrepreneur to launch a business, pay taxes, obtain building permits and beyond. While not a perfect measure, it is invaluable for providing some sense of exactly how far behind most African nations are relative to the rest of the world. If you were going to invest in a developing world entrepreneur, would you choose to invest in one with one of the worst business environments in the world?

Easterly was famously fired by the World Bank after he provided an honest analysis of just how ineffective the foreign aid establishment has been. In this article, he uses data on economic freedom from the Fraser Institute to show how economic freedom is more likely to lead to prosperity than is foreign aid. The section on how entrepreneurs need economic freedom is especially relevant to my talk — no one can predict who out of thousands of entrepreneurs will succeed, which is precisely why nations need to lessen the restriction on entrepreneurial initiative if they want the benefit of entrepreneurial job creation and prosperity.

This is an emotionally powerful film about my work manufacturing SkinIsSkin lip balms in Senegal; the impact that job creation has on Senegalese employees; the obstacles faced by an indigenous entrepreneur in Senegal; and how the resulting mass unemployment drives wave after wave of economic refugees to Europe, often dying along the way. The film has been endorsed by Nobel laureate economist Vernon Smith; George Sharffenberger, Director of UC Berkeley's Masters of Economic Development Practice; Tyler Cowen of GMU; and Gene Epstein, former economics editor of Barron's. Entrepreneur Laurel May Troy writes of the film, "This is a stunningly powerful story. It took me three days to make it through because I kept crying and sobbing and my heart felt overwhelmed, so I needed a rest."