The Formal System for Code

De Soto estimated that the formal property systems of the developed world took between one and two centuries to build. They were not designed in a single legislative act. They emerged through centuries of incremental formalization—the gradual conversion of informal customs, local arrangements, and extralegal practices into codified, standardized, enforceable systems. The Homestead Acts, county recording offices, surveying standards, title insurance, and mortgage lending each added a layer to the representational infrastructure that allowed land to lead a parallel life as capital. The developed world has forgotten how its own infrastructure was built, and therefore assumes that what the developing world lacks is assets rather than systems. The same forgetting afflicts the AI economy’s triumphalism about tool democratization. The formal system for code—the institutional infrastructure that converts AI-built software from a working artifact into a sustainable economic asset—took decades to build for the formal economy’s participants, is taken so completely for granted by those participants