 Some 40 years ago, the Secretary General of the UN decided to establish what is called the United Nations University. It's not a regular university, but it's a global network of scholars. The first institute established under the UNU was WIDA, the World Institute for Development Economics Research, established to do research in development economics. Over the years, WIDA has built up a global network, and at any one point in time, we now have about 300 agreements or contracts with institutions across the world, with individuals across the world, and this network includes both senior Nobel Prize takers, we actually have no less than 12 of them in our network, as well as early career researchers. We bring these people together, we work with them to produce research. Vietnam used for many years to be the largest aid recipient country in the world in absolute terms. A lot of people think that Vietnam never received aid. They say that it was only Vietnam's own efforts that has created the development we see in Vietnam. That has played a big role, but aid has helped. We were asked to investigate what works in aid, what can be scaled up, what can be transferred, what can be learned from 40 to 50 years of experience with foreign aid. We also looked at what are some of the lessons that can be learned, what has not worked in aid. We basically brought together a network of no less than 300 researchers from something like 60 countries, and we have then produced working papers, 240 working papers on foreign aid issues, all kinds of dimensions of aid. The overall message from the RECOM aid research that we have been doing is that aid does contribute in a positive way, in a statistically significant way, to the development process. We study the development process, trying to control for other factors. We can isolate the impact of aid, and when you provide a country 10% of its GDP in aid over a period of time, sustained period of time, then actually such countries, they have more than 1%, actually around 1.3% additional growth. This is important. That's not a small number. This helps further the development process. We've looked at this from around 1970, which is around the time where data become reliable up until 2007. And that period is long enough for us to actually be able to get the data to tell a story. I have for many years been interested in trying to do work on time series where you have data over a longer period of time for individual countries. And a couple of years ago, Caterina Eusilius, who is one of the leading specialists in this area, agreed to work with us under the RECOM program. So we've analyzed 36 African countries, and in 27 of those, we find very clear evidence that aid works pretty much as our economic theory or economic models tells us. So aid impacts on investment in a good, positive way. Aid impacts on growth in a good, positive way. And aid does not undermine public budgets in the aid recipient countries. So overall, we can conclude that there is substantial evidence to suggest that aid has worked in a good and constructive way in a very large majority of the countries that we study. Ghana and Tanzania are two countries that have had particularly big breaks in their development processes, both centered around major events in their economic and social and political developments. And these breaks you have to take account of when you do your analysis. For example, in the case of Tanzania, it's important that you analyze the period before and after 1986 separately, because the two so-called policy regimes were very different. When you do that, then a rather convincing story that aid has actually helped strongly in the post-86 period comes out. We do not disagree with Rajan and Subramanian in relation to the size of the potential impact of aid on the growth process. We actually believe that the potential impact is about the same as suggested by economic models. The difference between what Rajan and Subramanian did and what we have done is that we have carefully sifted through. And we can actually show that our work suggests that the impact is statistically significant. So contrary to them, we can say that the impact is there, because they conclude that it's statistically insignificant, they're not allowed to say whether there's an impact or not. The challenge in meta-analysis is that economics is a social science. And then isolating the impact of a treatment, in this case aid, that is provided to aid recipient countries is not so easy. We cannot do this analysis in a laboratory as you can in medical experiments. So what you do in meta-analysis is that you bring together results from different studies and you consider each study an illustration of this relationship between aid and what happens in the developing country. Now we don't have perfect comparability as you have in medical research. We therefore have to be very careful when we draw the conclusions out from such work. Dukl Jager's and Paldem, they studied what they felt that 68 studies done before 2005 can say about the relationship between aid and growth. They concluded that there is no statistically significant relationship. This means in their interpretation that there is no impact to be spoken of of aid on growth. We revisited that. We went through the data, we went through the methodology and we made a series of choices which differ. As you know, economics professors can often disagree about methodological choices. And I'm not going to here go into the details of that. But what I can say is that when we make what we believe are better assumptions as to how to analyze these 68 studies, we reach a different conclusion. We conclude that there is a statistically significant impact of aid and growth, which by the way is consistent with the results from our other tools, from our other types of analysis. So we believe that in some ways the meta work without telling necessarily the full truth forms a part of the puzzle that actually fits with the rest. So it is on this basis that we have concluded that this particular piece of work adds further evidence to our overall conclusion that aid works. Aid is of course provided for many reasons with many objectives in mind. Aid is provided to save lives. Aid is meant to do a lot of different things. If you refrain from thinking about that for just one second and say let's now just consider aid as an economic resource, as an investment, what would that tell you when you try to do the analysis? If you are a banker or an investment broker, you are interested in the return on your investment. What we have uncovered is that there is an overall aggregate return on aid, which is about 7.3 percent on average over a sustained period. Now this is a very good return. This is better than what most institutions these days actually get on their investments. And this return ends up with the poorest people of the world. You can say that because essentially what we have done is that we have said there is no single methodology that can tell us the full story about aid and growth. There is no single methodology that you can say is the only one that can help provide insights into this relationship. So you can compare it to saying well I am using different types of binoculars for different purposes. When you use them, approach this issue from four different perspectives, we end up with the same general story that aid helps promote savings, aid helps promote investment, aid has a return and therefore helps promote growth. And we can unpack this and show that this is not just the upper income classes that benefit from this, actually aid does eventually end up also in the pockets of the poor. Since 2008, the general story that comes out not just of the income work but also of other work is the one I have been talking about. Aid basically underpins the growth process. There are different estimates of the strength of that relationship but that is not atypical in economics. We always have a range of outcomes and what we can say in terms of the aid growth relationship is that that range or those range of outcomes they lie in the positive area which is why we are confident in saying that there is a positive impact of aid and growth. But I wish to stress that that is just one element, one aim of aid but it is often used as a litmus test whether aid is actually working. The challenge of creating jobs, employment has been underestimated in terms of its importance. It has been expected that that would happen automatically. As we have seen over the past few years, it does not happen automatically. We have seen uprisings, we have seen reactions to the fact that young people did not have the jobs waiting for them that they were expecting. It is important to understand that jobs, good jobs are only created if economies are transformed, if economies develop and as part of this process that people get employment. Yes they are indeed. We can have many discussions about aid and growth, aid potential contribution to employment but at the end of the day a lot of aid is provided to help develop social sectors, to put children in school, to make their health better, to save lives. As we all know, a good and healthy life is very important for your welfare. Now this is one side of the coin. The other side of the coin is that when you are healthy you are more productive. So there is both a welfare dimension but certainly also an economic return dimension because you are much more productive if you are not sick. In the social sectors you can see a lot of real results materializing. Anybody who looks at the general statistics we have from the social sectors cannot avoid to be actually quite impressed. You see school enrollment having gone up very significantly. This is both for boys and girls and this is across the developing world. This is also in Africa. Children are now actually going to school. You also see it in an important indicator such as maternal mortality. Much fewer women than before are now actually dying when given birth and the decreases in those indicators is very significant. It has definitely helped in the transition to more sustainable institutions. It has not always been as effective as we would like to see in, for example, the consolidation of multi-party democracies. There it has often been not really sustained in ways that we would like to see. But in general it has played a positive role. But one must understand that in fragile circumstances there are going to be backlashes because aid is, after all, a relatively small part of the overall picture. What's very important when we are talking about climate change is to understand that aid cannot by itself save the world in this area. Aid is simply too small. Aid can help mobilizing other resources. Aid can help supplement sensible political decisions about the aid and climate change area. Aid alone cannot do it. The challenge is simply too big. We need to see the world relying on much more sensible approaches to the way in which we use energy. We have to develop new technology. We have to get private funds to be invested in climate-friendly ways of economic affairs. Poor countries have to use more energy as they develop. Without more energy use they will not develop. The challenge is to provide this energy in an environmentally friendly way. This means developing new technology such that the energy that is produced and used harms the environment less. The challenge is to develop these energy sources in such a way that they are available to poor people so that they can develop as the rest of the world has been doing. If they have the right possibilities, the right access to clean energy sources, they will use them. We have within the international development community to try to help them arrive at this situation where there is a win-win between development and poverty reduction on the one hand and the environment on the other. We are not there yet. There are still in lots of cases trade-offs. We cannot in all cases say that the best development solution from a poverty reduction point of view is also the best from an environmental point of view. We need to help reduce those trade-offs with what we do on technology development and in support of promoting the financial resources that are required to diminish these trade-offs. I believe that economics and development economics in particular has been going through a period where we have been very concerned about more specific interventions, more specific, more localized issues. I believe that what I sometimes refer to as bigger development economics is going to take center stage in the coming years. At the end of the day, issues around structural transformation, around inclusion and around sustainability, they are big issues. And economists and other social scientists should not shy away because if we shy away, then we're not making available for policymakers the insight that we can help provide. I would invite everybody to go to the RECOM website to try to read more, to study more and to see and appreciate the wealth of information that has actually been compiled during the RECOM research project.