I am looking for the author of an economic theory that argues the
following. Taking the average poor person in a third world country
that for example operates a vegetable stand and owns a home which he
does not have the title for. The economic theory is, if you could
actually quantify and legitimize this poor persons assets they can
then be able to borrow capital to finance their business using their
existing assets rather than wait 20 years to save enough to finance
their move from a small vegetable stand into an actual proper store.
This not only makes people instantly wealthy it allows them greater
leverage with banks. I am trying to find out who the economics scholar
is that wrote this theory. I think he may have been nominated to win a
nobel peace prize in economics. Any help would be appreciated!

Dear datapalace-ga, 
I believe the author is Peruvian economist, Hernando de Soto. Mr. de
Soto is president of the Institute for Liberty and Democracy (ILD) in
Lima. In 2001, he was nominated for the Nobel Prize in Economics.

This are extracts from the first chapter of his book 'The Mystery of
Capital - Why Capitalism Triumphs in the West and Fails Everywhere
Else'.

"....Because the rights to these possessions are not adequately
documented, these assets cannot readily be turned into capital, cannot
be traded outside of narrow local circles where people know and trust
each other, cannot be used as collateral for a loan, and cannot be
used as a share against an investment..."

"...The poor inhabitants of these nations ?the overwhelming majority?
do have things, but they lack the process to represent their property
and create capital. They have houses but not titles; crops but not
deeds; businesses but not statutes of incorporation..."

The chapter appears on the web site of the Institute for Liberty and
Democracy which carries other articles by the economist.
http://www.ild.org.pe/tmoc/cp1-en.htm

In an interview he explains how the theory turned to reality
"We went into towns to legalize housing, evaluate property, and give
owners titles and deeds for their properties. More than 400,000
companies moved from the informal to the formal sector. Tax income
increased by $400 million a year between 1993 and 1995 and over half a
million jobs were created. In towns where people had legal assets, 20
percent more children were enrolled in school."
http://www.worldpress.org/Americas/1602.cfm

Background information
http://www.nationalreview.com/comment/grewell200310091025.asp
http://www.rose-hulman.edu/~delacova/economy/economics-prize.htm

Other links to his ideas, and criticism of them, can be found using
the search strategy below.

I hope this answers your question. If it does not, or the answer is
unclear, then please ask for clarification of this research before
rating the answer. I shall respond to the clarification request as
soon as I receive it.
Thank you
answerfinder

Search strategy
nobel prize economist "borrow capital" gave me Ronald Coase. After
dismissing him, found references at the same time to de Soto which
lead me to this search:
"de soto" nobel prize
://www.google.com/search?hl=en&lr=&ie=UTF-8&oe=UTF-8&safe=off&q=%22de+soto%22+nobel+prize

Great service