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In an article re-published in The Wall Street Journal last year, The Secrets of Intangible Wealth, author Ronald Bailey writes the following, “A Mexican migrant to the US is 5 times more productive than one who stays home.” Did your interest peak like mine when you read that line? The data comes from research done by the World Bank. Here is the reason why according to Bailey. The average American has access to over $418,000 in intangible wealth, while the stay-at-home Mexican’s intangible wealth is just $34,000.
What is intangible wealth? The World Bank’s environmental economics department describes it as, “trust among people in a society, an efficient judicial system, clear property rights and effective governments.” The value of these intangibles according to the World Bank is significant. Who wants to invest in property if it can be taken away any time? Who wants to develop a large manufacturing plant in a location where these intangibles are hard to come by?
