Yale political science professor Douglas W. Rae continues his course Capitalism: Success, Crisis and Reform with a lecture on Hernando de Soto's theories of dead and live capital and the role of property rights in economic development. Rae works through de Soto's argument that informal property must be formally integrated into legal systems to become productive capital, then turns to Baltimore's row house vacancy problem as a case study in how entrenched local interests block property policy reform. He revisits the Coase theorem and transaction costs, and leads a class discussion on how a developing country might best invest five percent of its GDP. The lecture also covers the historical capitalist take-off, the joint stock corporation, and the rise of a culture of consumption, tracing how institutions and habits combine to turn dormant assets into working capital.