 We can reasonably ask why the benefit of global relations have not been more widely shared and why major part of the African continent in particular have seemingly been left behind. Our next speaker, Professor Sir Paul Corrier, in his book, The Balambillion provides an accessible, innovative and provocative analysis of why some countries remain trapped in poverty. Along with possible strategies for overcoming their difficulties, Corrier identifies a variety of traps that are common to these countries, preventing them from joining their more prosperous neighbors. For example, natural resources which are often plentiful in Africa can nonetheless prove to be a curse for a country. Professor Corrier argues that there is an alternative to plunder. But developing and implementing good resource management policies, like all good economic development policies, require good and stable governance structures. Something that the countries in the Balambillions have sorely lacked. Since the early 1960s, when most of the African countries began to achieve independence, more than 50 groups have taken place on the continent, each taking their tolls on current and future economic development. Professor Corrier's book has been widely pressed for bringing subject matter that is often ignored by the Western world to our attention, including the Balambillions. He has published six books and a number of revolutionary papers. In a plundered planet, he addresses how resource-rich environment in developing countries have been traditionally misused. Many of these countries have suffered from one of two forms of plunders, where the few steals from the many, and where the present steals from the future. Corrier sees the failures to harness natural capital is the single most important means of opportunities in economic development. In war crimes and wars, Corrier argued that democracies in the superficial election-focused form has actually increased political violence instead of reducing it, in the 58 most impoverished countries that are home to the Balambillion. In his most recent book, Exodus, Professor Corrier clearly and concisely laid out the effect of encouraging or restricting migration. Join our original research and case studies. He explores these volatile issues from three perspectives. The effect of migrations on the departing people's new homes. They're all homes and immigrants themselves. Robert Zezik, former president of the World Bank, US Trade Repentitative and US Beauty Secretaries of State, said of Exodus. Exodus is his latest able to subject a big topic to straightforward question that most other scholars drink from asking. He courageously interconnect different fields of scholarship, addressing problem that don't fit neatly into academic categories. This book is a true achievement. In 2010 and 2011, foreign policy magazine named Professor Corrier to his list of top global thinkers. The economist magazine called him one of the world's most thoughtful economists whose book consistently illuminates and provokes. Sir Paul Corrier is professor of economics and public policy and director of the Centers for the Study of African Economies at Oxford University and has served as advisor to the strategies and policy department of the International Monetary Fund and to the Africa region of the World Bank. Corrier was appointed commander of the orders of the British Empire in the 2008 birthday honors and knighted in the 2014 new year honors for services to promoting research and policy change in Africa. It is my great honor and privilege to introduce Professor Sir Paul Corrier. Thank you very much and thank you for inviting me. If you put yourself in my shoes, introductions like that are always terrifying. Let me put it into perspective. What Professor Yang didn't say, but let me tell you, is, yeah, I'm a knight, I'm a commander of the British Empire, the British Empire hasn't existed for all my life and knights will last relevant in the Middle Ages. What he didn't say was both my parents left school when they were just 12 years old. I am first generation educated and because of that I believe in places like Gustavus in events like this that actually bring education to people like my parents, what they didn't have. That's it, so let's get started. My subject is going to be Africa and it's future the next decade or so. The bottom billion, my little book, tried to account for why Africa had basically missed the boat of economic prosperity, which from 1945 through to the millennium had really driven a lot of countries to prosperity, but that hadn't happened in Africa. And then over the last 10 years Africa started to grow, started to catch up. And what explained that was you must all have waited at a bus stop, getting increasingly frustrated and then what happens two or three buses all come at the same time, right? And Africa the last decade was a bit like that, it had been stagnant for a long time and then four buses arrived in quick succession. At the start of the millennium Africa was up to its neck in debt and then the Jubilee 2000 campaign delivered debt relief. That was great. That got things started. Then you got global commodity prices rising and Africa is a commodity exporter and they didn't just rise, they rose and kept on rising so what's commodity prices are usually described as a cycle, but this wasn't a cycle, it was the super cycle. And so Africa's export earnings rose enormously because of that price effect. And then a new thing happened for the first time for many years because commodity prices were high, companies could raise money to finance prospecting for new discoveries. Where do you look? The sensible place to look is the least prospective place on earth, which is Africa. And so in addition to the price boom, Africa got a quantity boom. A lot of new resources were discovered. And then finally, after the global financial crisis, the world became awash with capital, liquid capital, as central banks around the world vastly increased liquidity. And so managers of portfolios thought, what do we hold? And so for the first time ever, a lot of African countries were able to borrow sovereign debt, issue sovereign debt at moderate interest rates, sort of 5% or something. And so there were four wonderful things all happening in quick succession. Each different, they are all over, they're completely over, they've been, they've gone, the buses have gone. There'll be a Jubilee 3000, but we've got another 984 years to wait. And so on and so forth. That glorious decade created an opportunity, a lot of temporary money. And of course what ought to have happened with that temporary money is that it should have been put to build permanent prosperity, should have been invested. And sometimes it was, but to a large extent it wasn't. The pressures of electoral politics led governments to spend on the recurrent nice to haves, putting up public sector wages and that sort of thing rather than investing in the future. And so in fact, let me give an example of that. Currently the most democratic country in Africa is Ghana, where governments keep changing. So it's democratic. And as a result of this great increase in prospecting in 2007, Ghana discovered oil. So that was great, a lot more money. And everybody cautioned Ghanaians about don't do what Nigeria did. And so Nigeria had had something over a trillion dollars of oil and hadn't got much to show for it. So the Ghanaian legislature passed a law, a very sensible law, which said 30 percent of the oil revenues have to be saved. So that was sensible. People that understood the issue, we must look to the future. We cannot plunder the future. But the devil is in the detail. And so what does it actually mean legislation that says 30 percent of the oil money must be saved? So what actually happened in Ghana was that a fund was created and 30 percent of the money coming from the oil was put into this fund, a piggy bank, for oil saved. So far it sounds right, but that wasn't the only thing that was going on. The investment blanks were flying into Ghana saying now you've got this oil money, you credit worthy. You could issue sovereign bonds. And of course people, ordinary Ghanaians were saying we don't feel better off. So there's a lot of pressure to spend. And so what's now happened is that the government has issued two rounds of sovereign bonds raising about two billion dollars. And it's used that to increase public sector wages 50 percent. So let's try and add it up. Yes Ghana has got an oil fund and about 200 million dollars has been put into that fund savings. But it's borrowed two billion from abroad and put that into consumption. So has Ghana saved 30 percent of its oil? Not really. It's gone up 1.8 billion as a result of the oil boom. So that's where the devil is in the detail. People were deceived into thinking that the society was being prudent when actually it wasn't. So what now? What in the next decade? It's very important that Africa continues to grow, continues to catch up, that these buses have gone. And so it's going to have to be based on a different strategy. It's really going to have to be based on a more fundamental strategy, going back to the basics of what it takes to get sustained economic growth. And so here we're going to get a dose of economics. No apologies. And the foundations of economic growth are to increase the productivity of ordinary people. There's no mystery to that. If ordinary people can be more productive, living standards can be higher, incomes will be higher. And we've known for a pretty well 250 years what the formula is for that miracle of productivity that turns people, the same people, much more productive. And I'm going to call the vehicles which produce that miracle effective organizations. And there are very few effective organizations in Africa. That's what's needed is a lot of these effect. What do I mean by an effective organization? It's got three components. The first two, a scale and specialization. That's what Adam Smith noticed. Amazingly, peasants, he was writing in Scotland 250 years ago, and he was seeing for the first time peasants were coming in from working in their cottages to working in factories. His example was the pin factory. And because people were brought together at scale, it also permitted them to specialize. Because they could specialize, they could get a lot better at what they were doing. And that produced dramatic increases in productivity. Let me give you an example from modern Ethiopia, where we've still got side by side artisan enterprises employing one, two, three or four people and modern firms. But if we compare in Ethiopian manufacturing, the bottom edge of modern firms, the firm which has 50 workers and the top edge of artisan style production, a little workshop with four people. The productivity of the people in that 50 person factory, the productivity per person, producing per person is 10 times higher than in the artisan mode of production. That's the miracle of productivity. Not 10% higher, 10 fold higher. Just by moving from an entity of four people to an entity of 50 people. So scale and specialization, and then there's a third component, which is motivation. If you're working just for yourself, you don't need to worry about motivation. If you don't work hard, you don't produce anything. But in a big organization, it's much easier to free ride. And so alongside scale and specialization, somehow or other, the management needs to motivate people, and I'll return to that. Many organizations, some are in the private sector, some are in the public sector. In the private sector, we call them firms. In the public sector, we call them bureaucracies. And both are vital, vital for a modern society. There's a lot of debate and agonizing over should it be private, should it be public. That misses the point, really. We need effective organizations in each sector, and they complement each other. And Africa is desperately short of both types. And I'm going to start with firms. I've just been doing work on Dara Salam, the biggest city in Tanzania, and probably going to be a mega city, the East African coast mega city. And at the moment, the modal firm, the most common size of firm in Dara Salam, has one worker. Scale, zero, specialization, zero, productivity, doomed, depoverty. So that's where we start. Why? Why aren't there more modern firms? Well, what modern firms need in order to operate is not very complex. You can think of it as platforms which enable a firm to operate. And those platforms have two essential features. One is kind of really obvious, which is energy. You've got to plug in to a source of energy. And the other is a little bit more subtle, is connectivity. So let me start with a few remarks on energy and then explain connectivity a bit. Energy basically means electricity. And across Africa, with few exceptions, the electricity supply doesn't work. It's just very, very unreliable. And there's a straightforward reason for that. And that is it is provided by monopoly public utilities which have been captured by special interests. I know there's a Nigerian in the audience, Habiba. So, hi Habiba, I don't have to tell you about NEPA, the National Electricity Company. NEPA stands for National Electricity or whatever. But it's basically colloquially known as no electricity ever. And why is that? Because Nigerian energy policy has been captured by a few very wealthy people who own companies that import electricity generators. And over the years, they've repeatedly managed to block economic reform. And we'll come back to that. It's easy to provide reliable electricity. It's a very standard technology that everybody else has been using for over a century. So energy is a very fixable problem. It really just means changing the system of provision. And across Africa, that is now starting to happen. A friend of mine was the brave finance minister who introduced the reforms in Nigeria that changed the legislation. She got vilified for it because there were a lot of special interests which financed campaigns against her. But she did it. Let me turn to connectivity. And connectivity is a little bit more subtle. Why is connectivity so important for productivity? And the ascent from low productivity to high productivity is one way of thinking of it. It's the mastery of higher levels of complexity. Anybody can do simple. But to do productive, productive is more complex. If productive was dead obvious, we'd all be productive automatically. But the default option is not prosperity, it's poverty. And so how do we manage higher levels of complexity? Well, there are three different quanta in getting to managing higher levels of complexity. And the humblest level of managing complexity is this. It's trying to stuff more into the individual human brain. And our entire education system and training system very sensibly is focused on that. Let's try and get more into the individual human brain. Until about 1850, that was pretty well all that we had in the world for managing greater levels of complexity. But since about 1850, higher levels of complexity have broken free of the constraint of what can you get into a single head. And nowadays, complexity is managed mainly not by people who've got vast amounts in their individual heads, but by building teams of people each specialized but coordinated together. In the private sector, that's what a firm does. It manages complexity by building a coordinated and motivated team. Now, for that to happen, you need a lot of spatial connectivity. Workers have to be able to come together in a morning at a single place. They have to be able to get back at night. So you need to have connectivity between workers and the firm. The firm has to reach its customers. And so you need connectivity firm to customers. And connectivity is a spatial thing. It's about the ability of people to move from where they live to where they work, or from the factory back to consumers. So that's the second level of connectivity of the firm. But then since about 1970 or so, we've moved to a higher quantum of connectivity, which is beyond the firm. If you think of a modern product like an iPhone, that's an amazing piece of technology, does Apple know how to make an iPhone? And the answer is no. Apple depends on a whole network of other firms, each specialized in different bits of technology. And it all comes together. Now, so that's the third leap of managing complexity is connectivity between firms. Now, a lot of that connectivity is spatial. Firms need to be able to cluster. That's why you get around the world clusters of production. For example, my favorite example is these things, buttons. Two-thirds of the world's buttons are made in one city, but not police, that 40 years ago was a village. Why are two-thirds of the world's buttons made there? Not because there's anything special. If you scratch underneath the pavement, there's not paved with buttons or anything. There's nothing special about that city other than that, nor is there mega-button incorporated. There is no mega-button. There's just hundreds of button firms that have all realized their costs are lower if they congregate in the same city. So where have we got to? It's a vital matter if you're going to get modern firms to have cities which provide high connectivity workers to the firm, firm to consumers, firm to firm, industrial zones. African cities don't provide at the moment either the energy that firms need or the connectivity that firms need. How do we provide connectivity? Well, suppose I wanted to connect my left hand with my right hand. What could I do? There are two options, both sensible. One is let's build some link between them. That's building transport things, roads. And the other is move my hands closer together. And that's density. And the typical African city doesn't have enough roads and it doesn't have enough density. Why doesn't it have enough roads? Because roads cost money and African cities don't have anything like an adequate tax base. There's a theorem in economics called the Henry George theorem. I won't go into it, but what it shows is that the appreciation in the value of land in a productive city will more than pay for the cost of the infrastructure needed to make the city productive. And so as long as you can tax some of the land appreciation, you can finance all the infrastructure that the city needs. That hasn't happened in Africa nor any other sources of city taxation. And so city governments can't afford to provide the essential infrastructure, not just the roads but the sewage, the pipe, water, the electricity that a city needs. If we turn to density, when we look at the average African city, it's a single story city. It shacks. How has that come about? Why are people not investing to build proper dwellings that are townhouses, three storeys high, or apartment blocks, four or five storeys high? That's the sort of density that would be ideal, I think. And the main reason is that African cities very recent and land ownership has never been sorted out. And so in the typical African city, land ownership is completely confused. It's unclear who actually owns a piece of land. And so nobody risks investing on a plot of land because out of the woodwork can come other people saying, that's my land. To give you an example, there's one of the biggest slums in Africa, Kibera, just part of Nairobi, near downtown city center. So very valuable land. And it's a single story slum. And it's a standoff between two groups of people who claim to own the land, the people who are actually living there, and the people who claim to have some sort of legal title. I've been working on this with a team of colleagues. So we actually took the trouble to look to see who actually is claiming to own the land in Kibera. And it's top politicians, it's top army officers, it's top civil servants. Goodness knows why they think they own Kibera, but they've got some sort of legal title, not enough to actually make ownership a reality. So the people who also think they own Kibera, the people who are squatting, living there, stay there. And the result is a standoff in which that's a very low value use of some very valuable land. We estimate that if you could just put Kibera to proper land use, there would be a gain of something like $2 billion. And so potentially everybody, including the people living there, could be a lot better off. So that's the reason why Africa is short of firms, that firms locate in cities. And the cities at the moment are not functioning very well. This is a vital matter, because between now and 2050, Africa's urban population will triple. So two-thirds of the African city is not yet built. There's still time to get it right. But it's a vital policy struggle of the next decade. Let me turn from the effective organizations in the private sector, the firms that are missing in action, to the bureaucracies. And remember, an effective organization is scale plus specialization plus motivation. Africa has plenty of firms. What they lack is scale and specialization. It's also plenty of bureaucracies. They have scale and specialization, they're big. What they lack is motivation. And this is not true of every government organization in Africa, but it's true of far too many. Let me give you a couple of stories just to get your heads around what I'm talking about. Some of you are from schools around here. I don't have to ask you the question, do your teachers show up for class? But if you were in an African school, the answer would be sometimes. And so the organization of the school in a lot of Africa suffers from a fact that teachers are insufficiently motivated just to show up for class. They still get paid. But let's notch it up a bit of drama. One of the better-run countries in Africa is Zambia. And that's why we know the following story. About 10 years ago, Zambia had quite a bad AIDS problem. And so the global fund, which is the international funding mechanism for antiretrovirals, went to the Zambian Ministry of Health and said, you've got an AIDS problem. We will pay for you to buy antiretrovirals. And the top civil servant in the Ministry of Health, permanent secretary, heard that message and saw an opportunity, but not an opportunity for Zambia. What he did was go home and set up a private company, which he owned, which would import antiretrovirals. So with his night job, he imported antiretrovirals. And with his day job, he signed the contract as permanent secretary to buy the antiretrovirals from the company. Now, you may think I'm describing something that's potentially a conflict of interest, but that is not the point of the story. Because in order to maximize profits, this guy imported fake antiretrovirals. I tell that because he was at the apex of Zambia's health system. And yet, he'd obviously not internalized the very basics of what a public health system is for. So if he was doing that, how could he possibly build a public organization where the workforce was motivated to do its job? So the health system in Zambia had scale and specialization. But as to motivation, it was rotting from the top. I've mentioned education. I've mentioned health. But economists focus on one piece of public organization, which we regard as absolutely vital in the development story. And it's not what you might think. It's not health. It's not education. These are obviously very important. But the central thing that economists focus upon is tax administration. Until a country builds an effective tax administration, it can't get started. The key work on this is not mine. It's in modern economics. It's Professor Tim Bezley, who's at the moment president of the econometric society, very prestigious position. And the historical work was done by Charles Tilley, who's trying to describe the emergence of modern states in Europe. And the argument goes that only once the state builds an effective tax system so that the state is capturing part of economic growth, only then does the state really have an incentive to try and grow the economy, because the state captures some of the benefits. So even if you're ruled by a thug who's only interested himself, it's useful to have a tax system, because then his interests are somewhat aligned with yours. He wants you to be richer so that he can be richer. Of course, in a modern state, taxation delivers much more than that, because with accountable leaders, our leaders spend our tax money on things that we need. And so a tax system is doubly vital. It motivates government, and it provides the public goods we need. But building a tax administration is by complicated. You're basically handing power to individual tax collectors to go to firms and say, pay up or else. That's a lot of power for individual people. And so it vitally depends upon whether those individuals have internalized the mission of the organization. Now, we're going to take a little detour into the imagination. And I want you to imagine yourself in two different roles. And the first role is, in each case, you're going to be a tax collector, going to a firm and sitting down with it, looking at the books and saying, this is what you owe. But in the first instance, you're going to be a tax collector in Sweden. And in the second, you're going to be a tax collector in Kenya. And in each case, we're going to look at the sources of motivation. Those of you who were here yesterday afternoon and heard me critiquing traditional economics, I'm going to do it again. So we're not going to assume that the tax collector is just motivated by personal greed and nothing else. There is an account which just works on that assumption. The Swedish tax collector is personally greedy. He'd go into the firm. Would love to just grab the money for himself. But there's a camera watching him, in effect. And he damned. That, I think, is actually a complete travesty of the truth about why Swedish tax collectors actually don't pocket the money. Of course, there's an element of scrutiny. But overwhelmingly, Swedish tax collectors have internalized the mission. Why are they collecting taxes to keep Sweden one of the best countries on Earth? And so what's driving a Swedish tax collector? Well, in addition to self-interest, this says I want to be able to feed my family, there's self-esteem. The tax collector wants to enact an identity. And in the case of a, let's assume, let's imagine, that the Swedish tax collector is proud of doing a good job, getting the right amount of money from the firm and passing it up the system, that is his identity. What am I? I'm a good tax collector because I'm doing that. Where's he got that idea of his identity from a set of social networks that he's part of? We'll come back to that. So in addition to self-interest, he's got self-esteem. In addition to self-esteem, he cares what his peers think. He cares for peer esteem. And so he wants other people to be saying of him, Sven is a good tax collector. So there's a value and there's a norm and there's a perception of what is rational self-interest. And what are the social networks that Sven swims in, where he gets his identities, his values, his norms, and where he gets an understanding of what is in his rational self-interest? Let's imagine he's in three big social networks. He's in a work network with other tax collectors. He's in his family network. And he's in some much larger group, which in his case, we'll say, is the group of Swedes, people who think of themselves as fellow Swedes. And all three of those networks are actually pushing Sven in the same direction. He gets self-esteem by being a good tax collector, raising the money, passing it up the system. He gets peer esteem if he does that job properly. And he can say, this is in my self-interest because by doing this, by supporting this behaviour, what is happening to this money that I'm passing up the system, it's paying for the wonderful social provision that makes Sweden such a marvellous society. And so, Sven is not just driven by fear of that camera and the thought that if he gets caught, he'll be sent to prison. His very identity value system norms, beliefs in how the world works, makes him raise the right amount of money from the firm and pass it up. Now let's go to Kenya. Same job. Same structure. Self-esteem, peer esteem. Narratives which explain how the world works. Again, he's part of a work group. Again, he's part of a family. Again, he's part of a larger group of identity. But what's his larger group of identity now? Kenya is driven by ethnic divisions. There's a brilliant new study in economics of workers in a flower packing factory in Kenya. And what it shows is that the structure of the work is there's a production line. And the workers at the end of the line, wrapping the flowers up, are dependent upon what the workers at the other end of the line do. Basically, how many flowers they put at the other end of the line. Everybody's on piece work, piece rates. That is to say, the harder you work, the more you produce, the more you earn. So it's a very crude system. What the study finds is that when tribe A gets at one end of the production line and tribe B is at the other end of the production line, the people in tribe A choose to take their incomes themselves in order to reduce the incomes of tribe B. We've got such powerful oppositional identities. Instead of thinking of themselves as all Kenyans, one group is thinking of themselves as Luo, another as Kikuyu, and the belief systems that they've internalized are that they are the enemy. That's a disastrous set of psychologies. So let's play that out. We've got, say, a Luo tax collector in this system. He's coming to a firm and one option is that he raises the right amount of money from the firm and passes it up to his boss. The other option is that he goes to the firm because you can either pay 100,000 shillings to the government, or you can pay 60,000 shillings to me. That's the choice he's facing. Same choice faced by the Swedish tax collector. Why is the choice as different? Well, let's start with what is in the rational self-interest. The Swedish tax collector believes that if he passes the money up the system, it will be well spent on schools, on health, on pensions. What does the Kenyan tax collector believe? What's the narrative that he hears? If I pass the money up the system, what will happen to it? Well, there's one narrative which indeed says it will benefit all Kenyans. There's another narrative which says it will be captured by the people in power. The president at the moment is a kikuyu. It will be captured by the kikuyu. I'm a luo. I've no obligation to pass this money up the system. So that's the rational self-interest and then the self-esteem from being a good tax collector. Let's give the guy credit and say, yeah, he wants to be a good tax collector. And let's say his colleagues will give him pure esteem if they say, yeah, you're a good tax collector. But we've not said what we mean by being a good tax collector. Of course it can mean doing the job well, applying the right rules with the firm, raising the right amount of money and passing it on. But being a good tax collector could mean something quite different. It means you're smart. You know how to guide the system for your own advantage. So the young tax collector that's just come on to the workforce this week, the old guys say, go and talk to Beno there. He really knows a thing or two. You'll learn from him. But what they learn is not how to apply the rules. It's how to abuse the rules. So that I believe is the trap into which a lot of public organizations in Africa have fallen. That people are getting pure esteem, self-esteem from behavior which is in aggregate socially disastrous. And finally, how do we change it? Or how do they change it? And there are many different strategies, but I'm going to suggest one thing that is really important is leadership. We imagine that leaders are there to take decisions. They're actually also there as role models for what is good behavior and as communicators, weavers of narratives of how people understand their world. And so let me end with just a few stories of leaders that made a difference in Africa. One of my heroes is President Erari, the first president of Tanzania. He got his economics wrong. He was a creature of his times and the times socialist economics was very popular, so he picked that up and that didn't do Tanzania very good. But much more importantly, he got the idea that it was vital to persuade Tanzanians that first and foremost, their group identity was that they were Tanzanian. They were not this tribe or that tribe, they were Tanzanian. And he did very practical things to build that shared identity. He introduced a common language, Kishwihili. He introduced a common school curriculum. He introduced symbols of national identity. He made sure that when he recruited people into the civil service, they were not allowed to work in their own region. They were moved to another region. They were Tanzanian, not just members of the local tribe. And a few years ago, a very eminent economist, Ted Miguel, did a study to see whether that had been effective. And the study used the fact that across the border in Kenya, the Kenyan leader, Kenyatta, had taken an exactly opposite strategy. Kenyatta had got his basic economics right, but he got his process of social identity formation disastrously wrong. He was a kikuyu, he favored the kikuyu. When he died, he was replaced by the vice president who'd been a kalanjin. He favored the kalanjin. Now we're back to kikuyu, favoring kikuyu. So for years, Kenya has had reasonable economic policies, but a narrative which has emphasized tribe over nation again and again. So Miguel's little study was dead simple. It went into the villages on either side of the border. The border is completely arbitrary. It's a straight line drawn in Berlin in 1885, which divides a perfectly homogenous society. And some of the villages on each side of the border are single tribe. Some of the villages are multi-tribe. And so Miguel thought, let's see whether people can cooperate across the tribal boundary to do the basic public good that a village needs, a well. Can the villagers cooperate to maintain the well? And in Kenya, people can cooperate within a tribe, but not across tribes. And so the single tribe villagers had a functioning well, the multi-tribe villagers didn't. Then he went and looked across the border in Tanzania. And across the border in Tanzania, it made no difference whether the village was multi-tribal or single tribe. They were able to cooperate to maintain the well. And so 40 years of very different narratives had built very different identities, and that had very practical consequences for the ability to cooperate. So that was nearingly getting something right, using leadership effectively. Changing people's identity. Let's think about changing people's norms. And I've got two experiences there. I'm coming to a close. One of my current heroes is the chief executive of Kampala, the biggest city in Uganda. And she's called Jennifer Mosisi, and she's a fantastic woman. She's built a team of 50 people who are all as motivated, as passionate about improving Kampala as she is. And I was mystified to say, Jennifer, how have you done it? What did you do to build a motivated team? And she said, well, first of all, it was pretty simple. I've been appointed by the president, so I had power. So my first job, my first act, was to fire everybody. Well, that meant, yes, the next day I didn't have anybody. So I had to rehire some of the people, but I made sure that nobody went back to their old job. In fact, I changed all the job descriptions. And so it was as clear as possible that tomorrow was going to be different. And then, what she didn't tell me but I saw, was she led by example. She's there early in the morning. She's there late at night. She walks the talk. Tanzania has just got a new president, President Megafuli. And when a new president takes power in Africa, the inauguration ceremony, it's usually a very flamboyant, not to say expensive event. A celebration of a president coming into power. And President Megafuli decided this wasn't appropriate. Tanzania is a very poor country facing a struggle. And so he canceled all the inauguration ceremony. And he said he spent his first day with a brush sweeping the streets of Dar es Salaam. I wasn't there on that day. I was there shortly after. I learned about it from the taxi drivers because they were all deeply impressed. This was a signal to them that Megafuli was going to live differently, was going to act differently. We'll see whether he continues to walk the talk. But it was a good start. So you can change norms by personal example. If you live like a lord, you cannot then preach that people should be honest and work hard. My final example, so we changed identities, we changed norms. My final example is changing narratives. And this is going to be the story of my greatest hero in Africa. He's dead now, Saretsi Kama, the first president of Botswana. I'm very proud to be a little part of Botswana society. That's why I'm wearing this tie today. This tie is the tie of the central bank of Botswana, Botswana's Federal Reserve. And I'm on the board. And I'm very proud of that. So what did Saretsi Kama do? When he became president, Botswana was dirt poor. It was landlocked, arid, impoverished. There's now about the richest country in Africa. How do you do it? Well, the economic reason is that Botswana found diamonds. But so did Sierra Leone. And Sierra Leone dropped to the bottom of the World Human Development Index as a result of diamonds. So natural resources are not the royal road to prosperity far from it. But Kama did two things that were very sensible. One is he went round all the clan leaders saying, we're going to look for diamonds. The neighboring countries have them. We don't know whether we got them, but we probably got them. We got to decide who owns them. There could be belong to whoever, whichever clan finds them or they could belong to all of us. Which as clan leaders would you prefer? Clan leaders thought about it. You don't have to think about it very hard to realize the best thing is we better all share it. The nightmare is the clan next door finds them and you don't. So it's safer just to share. Now that made Kama a very far-sighted man. Why he was a great man was that the mining companies had given him a little bit of advanced geology and said there's definitely diamonds under your clan. He put the national interest ahead of his own clan. That's greatness. If Britain had done that when we started prospecting for oil, we wouldn't have now been the situation where a country that's 309 years old may well split apart with Scotland saying it's Scotland's oil. Kama's other great change, once Botswana got the diamonds, was to introduce a very simple narrative which every Botswana knew and still knows. And that is we're poor and therefore we have to carry a heavy load. Very simple. I was just in Tanzania recently where they discovered gas and I talked to the commissioner and it was offshore gas. But sure enough the region where it was discovered within months people were saying it's Matwara's gas, not Tanzanian, and they were saying we're rich, we don't have to work anymore. If you think about it, that phrase, we're rich, we don't have to work anymore, is almost verbatim the opposite of we're poor, we have to carry a heavy load. And what Kama did with that phrase was he immunized a population against the temptation of populism. We found diamonds, let's throw a party. No, we found diamonds and so we're going to use them prudently, gradually to lift ourselves out of poverty, which is what Botswana did. So, I apologize, I've taken you on a long tour through the foundations of economics, the miracle of productivity, effective organizations, firms, and motivated bureaucracies. They're what Africa needs. They're what Africa's got to build in the coming decade. Thank you very much. Thank you, Professor Collier, for that great talk. We will gather the panel up front and get everybody wired up and we'll take your questions. Please send them to the ushers and we'll try and get to more of them today.