Money is not capital in most of the developing countries. It's just cash. Because it lacks the institutional, organizational, managerial forms to turn it into capital.
Interpretation
In developing countries, money often does not function as capital due to a lack of necessary structures for investment and growth.
Ashraf Ghani's quote emphasizes that in many developing nations, what is commonly referred to as money does not serve the purpose of capital because the essential systems and structures, such as institutions and management, required to leverage money for economic growth are absent. This distinction highlights a critical barrier to development, as without the ability to convert money into productive capital, economic advancement is severely limited.
In practice
During an economic conference discussing the challenges of growth in developing nations.
Economics taught in most of the elite universities are practically useless in my context. My country is dominated by drug economy and a mafia. Textbook economics does not work in my context, and I have very few recommendations from anybody as to how to put together a legal economy.
It is my guiding confession that I believe the greatest error in economics is in seeing the economy as a stable, immutable structure.
Regulatory reform must move beyond limiting the damage that the financial sector can do and ensure that the sector genuinely serves society.
Automation provides us with wondrous increases of production and information, but does it tell us what to do with the men the machines displace? Modern industry gives us the capacity for unparalleled wealth - but where is our capacity to make that wealth meaningful to the poor of every nation?
Our economy is the result of millions of decisions we all make every day about producing, earning, saving, investing, and spending.
It is an extreme perversion of capitalism if you can trade in something before you have even paid for it.
Fair treatment in the work force is no longer exclusively a labor issue, nor is it a women's issue - it is a fundamental economic issue.
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