Nobel Laureate Douglass North once said that, “if the institutional framework rewards piracy then piratical organizations will come into existence; and if the institutional framework rewards productive activities then organizations – firms – will come into existence to engage in productive activities.” Prof. North’s observation is proving to be awfully accurate in Venezuela.
The country’s recent bank scandals have exposed the internal workings of the so-called “boliburguesia” (boligarchs), a shady—piratical—network of businesses that thrives thanks to favors granted by the presidency. The boliburguesia’s plain and simple crony capitalism is even more regrettable in light of the government’s regular assaults on the market economy and its promotion of socialist practices.
