Welcome, everyone. It is my great pleasure to start this event.
This is the book launch for us, as you know, for Stefan Durkin's gambling on development, why some countries win and others lose.
Stefan is professor of economic policy at the Blavatnik School of Government and at the Department of Economics.
He's also the director of the Centre for the Study of African Economies and the co-director of the Oxford Martin Programme on African Governance,
which is the the entity hosting hosting the event today.
And let me start by thanking the Martin School and Clara Boyer in particular for all the support
in putting together the event and generally speaking and supporting our programme here.
Stefan, as you know, is not just an academic, is also someone who has a very long trajectory in policy advice.
Most recently as development policy advisor to successive foreign secretaries in the UK, Foreign, Commonwealth and Development Office.
But before that, Stefan has literally decades of field experience across both Africa and Asia and most parts of the world, in fact.
And so his his book, which I have to say is written with a degree of honesty,
a candid sort of demeanour which is rarely the case in policy and policy advice.
And therefore, having just finished reading reading the book, I very heartily recommend it's read.
It has amazingly insightful experiences shared out of his long engagement with the field, but it's also not holding back.
It's not the sort of treatment of these issues that we sometimes see as characterised by understatement.
Is Stefan is definitely not pussyfooting around some of the hottest and most
controversial topics that we've seen in this field to discuss Stefan's book.
We have two distinguished guests.
It's my great pleasure to introduce Melinda Bohannan, who's strategy director at the Foreign, Commonwealth and Development Office.
Melinda was previously strategy director at the Department for International Development.
She's been with the civil service for more than 20 years and has had again a vast amount
of experience in the field that in a way mirrors Stefan's long and diverse engagements.
Melinda's voyage from the Middle East and North Africa to sub-Saharan Africa,
the former Soviet Union and China, so it will be a great pleasure to hear from Melinda.
And finally, we have David Pilling, who is the Africa editor of the Financial Times.
David was previously Asia editor and also Tokyo bureau chief of the Financial Times, and he has been with the FTA since 1990.
And amongst many other achievements, he's written Outstanding Book on Japan, which I very much enjoyed.
And without further ado, I'd like to call on Stefan to come and present his book, and then we will have Melinda and David in succession.
And finally will open the floor to questions from the audience.
Let me just say that in addition to those in the audience here today, we also have an online audience, so we will take turns.
We will deal with the questions and comments that will come from from this room.
But Clara Boyer will also bring in contributions from our, I imagine, sizeable online audience.
So well. Well, thank you very much, Sir Ricardo, for this very nice welcome.
I have this feeling that maybe I should have had a few more people read the book beforehand because
I get this gentle sense that I'll get a bit in trouble here and there with with the book anyway.
One thing that the publisher let me sign is that he has no liability for anything if there is any libel trials, but I don't think I went that far.
But you know, of course, I would like you later on to read the book, and I think black holes will be here later on over a drink.
You can, you can get it.
But I thought it would be a good idea to try to tell you a little bit about the book and get a bit of the the story line of it.
So, you know, Ricardo was introducing, it's already, you know,
I've been for 30 years actually hanging around in Oxford, doing research, going all kinds of places.
And you know, I work in the countryside, largely in developing countries.
I also work on, you know, big problems of development, industrialisation and in Ethiopia, all kinds of things that I was involved in.
And I do what academics do is talk a lot, you know, and go and give talks and so on.
But the luck that I had was about 10 years ago, I managed to get much more involved in the publishing world.
I was really lucky to. In many ways, I was a total unknown quantity for them, but different, you know, Ohio, the Belgian as their chief economist.
And you know, I and I thoroughly enjoyed this and I must say, you know,
lots of what you see here is also the result of just endless interactions with people in that organisation.
And basically, you know, we as academics, we have a certain knowledge.
But you know, what do you do with it in a political environment is actually quite a different, different matter.
And then of course, you do what you then can do as a senior official in your organisation.
You can travel around, meet all kinds of people.
And I must say I've been lucky to to meet with extraordinary people such as the governor of the central Bank of Uganda recently passed away.
An amazing figure, quite amazing figures in other countries as well.
Like in Nigeria, he had the vice president. So now you talk to them and you listen to them.
What they tell you and a lot of the book also tries to do is to reflect a bit, you know, what are they trying to do actually?
Well, what is it that in many of these countries, we're actually doing now?
Behind it, we should just be have actually quite an amazing story in this period that I've
been in the policy world and there's absolutely no there's only pure correlation.
But but you know, you know, we have an amazing thing.
This is from our world in data. If you have any data, just look at them. But basically, this is the total population, extreme poverty in the world.
You know, this is the definition, whereas carefully as we can and as wealth and data.
And in fact, it's using World Bank data trying to get us compatible as we can at a very low standard of
living in some kind of what we call purchasing power parity dollars of one point ninety,
but call it a very low level of of of of income or consumption.
Try to actually just count how many people are below that kind of line.
And it's all the time trying to be consistent so you allow for price changes and all the kinds of things.
So when you look at that, of course, we have an amazing thing around 1990s that, you know, we were not very far off two billion people.
That's way below that line. And what, however we calculated was definitely well above a billion and a half, and it was a lot of them was in Asia.
The rents, the population here. There was a quite a lot in South Asia, which is like India, Pakistan, Bangladesh and so on.
And then there was some in Africa as well, which is smaller in Africa because population wasn't that.
And I want you can see over time and especially somewhere around 2005, this kind of acceleration of poverty reduction in Asia.
Not the same things. I mean East Asia here. That is actually declining dramatically.
South Asia, that gets kind of a positive line.
Maybe it's not as dramatic as it suggested, but it's definitely by the time COVID came was going down dramatically.
And Africa, well, you know, the number of people below the line keeps on going up.
Now it's not a percentage.
You know, there is a decline in the percentage of people below the poverty line in African countries, but the picture is very mixed.
OK, so but it is a time of quite dramatic progress in some places of the world.
And in a way, this is this. Even within Africa, we have this kind of distinction between different places, what's been going on?
And so sub-Saharan Africa, the kind of the growing the green part of Africa here in that map,
you know, we we we had in 1990 quite a lot of countries with really high, very high poverty.
18 countries have a population of more than 18, sorry of more than eight million, and they have more than a fifth of their population below that line.
OK, so it would have been 50 60 percent.
Actually, since then, there's only two of these countries that actually have seen poverty declining significantly housing and what's gone on Ethiopia,
actually, there's other countries where it doubles.
So we get a whole heterogeneity of the story of some countries with changes happening in other countries.
That's not. And in some places, it's really dramatic the DRC, Nigeria, Madagascar,
these are a lot of people that actually ended up in extreme poverty and where it actually has changed.
And so this is not just in extreme poverty,
it's also reflected so this that difference between the experience of countries is also something we see simply in the economy.
This is GDP growth where you get, you know, quite a lot of the Asian countries.
So very dramatically, this is China.
Over this year at ninety nine point twenty seventeen, this is GDP per capita in comparable prices and so on and so on.
China doing really well, Indonesia actually doing remarkably well as well.
India beginning to take off as well, Vietnam taking off, Nigeria seemingly doing something,
but having started actually well above, say, India or Vietnam doing a bit.
And there's a lot to do with how you recalculate your GDP, unfortunately, and this is actually just essentially stagnation.
There's not much happening. DRC, the Democratic Republic of Congo, it's actually in income.
In economic terms. It's actually poorer now than it was by 1990. And even then, it was so much poorer than it was in 1970.
And so you actually have a declining thing.
Ethiopia, belatedly very poor country to start with the poorest of this list, but actually starting to rise.
And in fact, Ethiopia in this period since 2010 has the fastest growth in GDP per capita actually of the whole world.
OK, so you get countries where things are beginning to happen. Bangladesh here, Ghana, Nigeria, not very much Vietnam, India and so on.
So you get to heterogeneity and this is actually what I wanted to start saying.
OK. Yes, the world sucks. So we can all be saying it's a lot of terrible things happening and poverty and North-South difference are massive.
Or, you could say, is a really great story to tell, as they sometimes like to tell them in New York,
at the U.N. and saying, Look, poverty has been going down dramatically.
Whatever we should celebrate that, you know, we should celebrate it in some place, but not places.
It actually is not happening. And that's actually is a bit like what I wanted to kind of talk about in the book.
And that definitely by having the chance not just to work on one country but
having a lot of places I could start comparing and and working in and so on.
And over the last 30 years, probably, you know, 20,
30 countries or more where I've spent actually considerable time written about it, usually internally.
And I should say actually quite a lot to the book initially started its life as internal notes and in different so.
And it's these questions.
You know why countries that seemingly quite similar in the same continent together and some are actually doing really well and others doing it all?
Not at all. Not all. Well, that's what we're trying to do now. I'm not the first one, of course, that writes about developments.
I don't know. This is could be a good pop quiz. Who do you recognise? Who is the who is the calmest or the most tolerant person in this picture?
I'm so on. And so you could have talk a lot about a lot of things, but actually, maybe we don't usually do quizzes with people.
We do Christmas, maybe with books. Now this is the kind of standard fair.
It's actually the fair that I used to set in to develop a of scores here at Oxford.
Why don't you read these books? That gives you a sense, a diverse sense of what is development or what they think about, and this is not a perfect.
These are the bestsellers that's probably for better books. And in fact, I will mention a few during the talk.
But is the kind of things the dominant view that you have?
And in fact, I have a chapter, let's say, not always gently discussing each of these books, but the diagnosis that comes out of it.
Is. Well, a lot of what they write about is to say, well,
this is what you should do and then you develop and this is what you don't do and then you develop,
you know, we're very good at telling them, do this, don't do that. But we actually.
And within it, we get a lot of competing diagnosis.
You could probably have two broad groups. In diagnosis, one would say this is the Acemoglu Robinson, why nations fail, but a lot of others as well,
they just get your institutions right and where whether institutions come from, they come from history.
So why don't you get your histories right? OK, that's all you need to do, and you'll develop.
So but actually, it's not as easy as this.
You know. When we start looking at these countries that progressed, Bangladesh actually has terrible institutions in our normal rankings.
We can look at China in all these rankings. Where do we go on any kind of thing?
It looks really bad in its institutions. In fact, in 79, in any case.
China came out of real conflict. The Cultural Revolution, the gang of four year old Mao's death and the gang of four.
It was like, you know, you really started wondering whether they would survive and where it would turn into a massive civil war.
This is not a country with strong institutions, but we all date. 1979 The reform of the Chongqing Natural Things suddenly is all good.
So we should be very careful. Simply saying it's all institutions.
It's all history. Because why the seventy 1979 and nine, why not nineteen, forty seven and so on?
So you actually listings that and success cases.
They didn't wait for it. Yang Yang and has a really good book on China.
I use, you know, how China escaped the poverty trap.
And one of the big things is is that they had lousy institutions when they started and they did so well and arguably would say,
at least if we seen it saved from Washington institutions World Bank or IMF.
They still have lousy institutions very far, and they got very far in these things.
OK, now there's another line of thought in these books as well that you usually would say, Oh, but this is the list of things you should be doing.
These are the policy should be doing. These are the things you just do getting your policy struck.
Now that list, once you start looking at the more detail,
when you start comparatively saying what's on that list, we're actually relatively trivial things.
You don't get a good investment climate, get your get your infrastructure somewhat under control, do education do on health.
And of course, that list gets full. And in fact, about 10 years ago, there was a bit longer than 50 years ago.
Now there was a review by something called the Growth Commission. A Nobel prise winner, Michael Spence was put in charge.
And the one line I always remember from it, and in fact, I don't often remember it for the book.
I looked it up again, but I didn't remember much else. It was basically saying there is no recipe for success in development.
We know some of the ingredients, but actually the quite trivial, the quite self-evident what you should be doing.
So why is it that some countries do these things in other countries don't?
And that actually suggesting is that while there is actually some choice, there is some agency,
there's something to doing in these countries that some countries actually start doing it in other countries, not now.
History weighs on you and makes it hard, and I'm not trying to trivialise colonial history or that.
But within colonial history, some do quite well in, some don't. And that's actually what I wanted to start explaining, you know?
So why don't they, why don't they actually start doing it?
And for me, it was brought out best with. Within the space of six months.
I was actually in Kinshasa, Democratic Republic of Congo, for David, and I was in Ethiopia.
I'm actually quite similar events interacting in Kinshasa.
I was invited because they wanted me as a kind of a good economist, the chief economist at the time.
They wanted to tell me about all the development plans that we're going to do. And this was the Prime Minister's Office.
And so I walk into the Prime Minister's Office and I kind of show you the suits for billions.
I mean, it was amazing sets of suits around. And there were really, actually really eloquently,
but this young people largely eloquently explaining what the development plan was going to look like.
What are we going to do? One after the other saying there was a perfect plan, Frank Culture World Bank would have been proud of it,
but it was, you know, they were doing it, saying sorry, they were telling us this what they were going to do.
And the education made a lot of sense the health plans and say, Look, and I remember thinking, Wow, this is actually, you know, you know,
I've had some markets, you know, if I in the next day or so and what I should be doing for good development were all the locks.
And I remember walking out of this room and thinking, Yeah, and nothing will come out of it.
I've been I've seen a performance. I've seen theatre. Now, that's what I think in the DRC.
Meanwhile, six months later, with less than four months later,
I was in Ethiopia and it was explained to me as a small retreats with some quite high level prime
ministerial advisers and some people land rank of minister the things they were going to do in Ethiopia.
We're talking about 2012 2013. And actually, I just think, you know, the economics is not really quite sound.
And the rules say. I remember walking out of it, these plans, they were bit tricky and I was really worried about some things,
and this probably go wrong when this goes wrong with the macro economics and so on.
I remember walking out, Wow, this will work.
This actually probably will be delivered, and it's just this basic confidence that after a bit, you get in the DRC.
This was all show and Ethiopia.
This was going to be the difference and and in a way, what the book is about is actually trying to articulate what is it that?
What is it that at some point Ethiopia ends up delivering the fastest growth in the world and very fast poverty reduction?
Yes. OK. Until until 2020 with the conflict.
But where the DRC actually was probably going nowhere at the moment, at least,
maybe with the new government, Prime Minister Tshisekedi maybe is a bit of hope.
You know, we'll have to see now to try to start thinking about.
One book that gave me quite a lot of inspiration was actually Douglas North with Wallace and Wineglass,
and not necessarily for all the detail in the book.
He's an economic historian, Nobel prise winner, but actually a very simple thing that I knew and had not and not quite remember.
But you know, basically how as an economic historian, as an economist, economic and economic historian, he thinks about the state.
And so he sees the state as essentially a creation to solve the underlying problem that you have lots of gangs that are roving over the
landscape and trying to plunder and soil and say with actually saying rather than having little militias and gangs doing it to actually saying,
look, states emerge when actually different gangs or militias decide, well, actually, it's probably better to have peace and stability here,
and we'll probably make more money and controlling the resources than actually just trying to steal from each other.
OK, so the whole idea of it's something to do with elite groups that somehow make a deal around not to have violence,
but actually having more states that actually has security.
And then actually, let's use the resources that we have.
So in my book, I simplified and I know there will be economic historians worries about how I try to communicate this,
but is the way I like to actually think about many states.
I think of the state essentially as only parking as a deal between those who have power or influence in a society.
And whereby the elite are those who have power and influence, you know, this is the people,
it's not necessarily a large group, but it can be it can be quite open or it can be quite closed.
It can be whatever it is.
But I like to think of any state a bit like this as somehow an elite power gain of those who actually can make things happen.
And it goes in some places it's more accessible, more open.
In some places it may be more closed.
But it's the idea that there is somehow a state on the rise, some kind of deal, and the lying elite bargain is, to me, quite quite tempting.
And at a minimum, it's a coalition for peace and stability, just in the sense that across north have it actually as a way of of managing violence.
Now if you start looking at it, it typically would have a political deal.
Who controls the state, you know, is the few people. There's a lot of people.
Is it is it by election? Is it open elections, fair elections?
It's quite close to whatever it is, but it is a deal amongst the elite. How are we going to run the state politically?
And on the other hand, on the economic side, an economic deal, you know,
who actually is allowed to use resources and who gets what from the benefits from it?
Well, I have just a few big landowners that basically don't have tenants, and yet you have to pay.
You'll get maybe a little bit of the money or maybe groups of people who can't own property
or you have a lot of inheritance that basically you can never really stop and so on.
That's basically all societies and I think ours as well. It is the way in economic and political deal about who has access to the state
and who controls it and who has access to the resources and distribution.
And I use the simple framework to think a little bit different types of states can exist.
And the different types of states that can exist, you know, they can be very open.
They can be quite open. They can be a bit close. They can be cleared to list, as we say,
which basically would mean that most of what the states does is trying to give benefits for those who keep them in power.
You can be, you know, patrimonial as ever talked about a small bit chief basically being in charge and determining everything.
It can be quite open by close to can be ethnically controlled.
It can be, you know, whatever the deal is, it can be happening and we could have different ways of getting different states.
It can also be a kleptocratic state where the state is basically organised just to steal from the people.
And and doing that,
you can have plea bargains where let's say some oligarchs seem to be well connected to those in charge of the of the state and its military,
and creates a narrative around that that everything is fine and so on.
In fact.
Using Russia these days as an example of an elite bargain of a particular type probably helps to think about how you can think of a lot of states,
but again, think of ours as well in that sense. So how you don't get growth and development?
Well, it's actually an elite parking where it matters.
We're actually fundamentally and I call this a development parking where one of the underlying
features elite parking is that actually they're trying to get growth and development.
They're actually trying to get progress in the economy.
They use the resources not to distribute to their friends, but actually trying to make them work to actually make make the country richer.
And they use it also in some developmental thing.
This is not about perfect equality or whatever, but something is happening that we recognise as economic growth and progress in development outcomes,
lower poverty, health, education for a broad part of the population and so on.
And so what are the characteristics?
Well, you can't forget about the peace and stability, but it's the fundamental thing of leapfrogging because otherwise the state will disappear.
And in fact, I've learnt to be quite sympathetic to the speechwriters of Chinese ministers when they go around the world because they've got used to.
And of course, they've been told to always has the first paragraph to talk about it.
The most important thing is peace and stability. And I remember listening to that and thinking, you're probably right.
Actually, it's a crucial feature of a successful society that actually we sought out that there is a certain degree of peace and stability,
but it is more than if you want to be a state that has a developed embarking.
You want to make sure that you have Southwest states that basically is in the service of growth and development and not just tries to have big ideas.
That development should be state run or something, but actually self-aware of what it can to encounter.
And if you look across countries, some states are pretty capable and other ones are pretty lousy.
OK. China 2000 Here's a centralised taxation and centralised bureaucracy.
Not surprising that I can make centralised planning work reasonably well.
But not surprising that Bangladesh probably shouldn't try.
It has actually a very weak state and it's a young state, and it doesn't quite have this kind of capability to do that.
So you get in Bangladesh, progress is being made actually despite the states,
but it's a self-aware state in the South in that sense that it's allowed, you know, private sector NGOs.
In fact, eight play a big part in its development. And so he could actually do that, so you get different ways of getting to that.
But then the final bit should never forget. It's not about ideology and then just staying the course.
You know. We don't know the recipe of growth and development in general, let alone in any specific context.
We know the ingredients, you better try it out, try the recipe out.
And this important thing is to be willing to actually have some form of error correction,
bureaucratic, politically, some learning process of accountability and so on.
So keep in mind, I'm not asking for perfection.
This is not why nations fail. If you don't have perfect institutions, you do.
I know they don't quite say that, but sometimes the impression is created. You don't have perfection.
You know, there may be corruption, it may be possible the way to keep peace and stability your society, that actually to settle things up.
Now I'm not saying this is great. But actually, maybe it's part of that trajectory where you go through.
Of course, you don't want to approve of it and you want to find ways of dealing with that.
But it's not about expecting this perfection straightaway. It's definitely not all.
We have to have a marketing economy or statement economy. If you look at these relative successes, they're quite diverse.
In fact, the main thing is that actually you're being smart in terms of to what extent you use the
state and those who don't always overreach in terms of what their own state capability is.
It's quite healthy. So don't go around Africa saying in every country the state should lead the economy because I'm sorry.
States are not very strong. They have a very they can have a very clear and list nature.
They can have a very much where jobs are given to keep people in power.
Now that's not necessarily an effective state. Don't expect them to run the whole thing.
And finally, it's not about just elections or something. Malawi has had elections for a long time, and I'm sorry, not much is happening in Malawi.
This is not an elite ball game for for development.
This is not a live ball game for growth. So going through the motions of democracy is not necessary against autocracy, you know?
I'm not saying, Oh, we must have a strong leader.
So, you know, you have plenty of these countries on that list who don't have that and actually do quite well.
So it's not quite a choice that we can come back to in discussions. But the important thing here, it's a gamble.
When you start doing it, you don't know how it will end. And actually, it is actually quite tricky,
and that's quite helpful to briefly tell the Ethiopian story for a few more minutes and then to get towards the end, which is.
You know, the DRC, you know, plea bargain is clearly what it used to be totally kleptocratic under Mobutu the Kabila.
I'm not quite sure what it is, but it definitely is not developmental.
It is very much still recurring features of big natural resource contracts who are captured by small cabal linked to the family.
And you get all these kind of things. These resources are not ploughed back into the economy.
They cannot keep peace and stability. You can't trust the Congolese army in eastern Congo at the moment.
They are part of the problem there, not a solution and so on.
So you have all these things there in terms.
It's not even the preconditions for peace and stability, a state that is purely jobs for the friends or, you know, for the ghosts, actually.
Lots of people, lots of jobs that don't really exist,
but just a rent seeking system of payment and definitely very little correction or learning going on.
Ethiopia in this period say between twenty five and twenty twenty.
It was very much really totally looking for legitimacy of the regime through development, through growth and development.
It was very much seeking legitimacy to actually getting that it actually had a reasonably capable state.
Maybe it was over stretching it, but it was definitely trying to really learn from its errors.
And you have a lot of small tinkering going on and learning from it.
Of course, it was a gamble,
and the simple interpretation would be that if an elite bargain for development has to involve a political deal and an economic deal,
it may be focussed too much on that economic deal, on that progress. And they just somehow couldn't.
That underlying political deal consultants and actually proved very fragile and it imploded basically the different groups that were represented.
People sometimes forget these were all brothers in arms, the ones that are fighting now.
They were all together in the coalition at first.
And so, yeah, and that's the risk we have.
So in the book, I talk about lots of countries, the stories of all these different countries.
This is where I put them. I'm not going to put my hand in fire for exactness here, but this is what we do.
And I'll finally, what can we don't do as outsiders is what we want like to hear, you know, can we do something about it, though?
Throughout the book, I use the word outsiders, you know,
and this is very helpful for someone like me who sits in the inside of Whitehall for a long time.
We tend to forget we are outsiders in the development community.
We love to tell them what to do, whether in Washington or in London and so on.
We should just be conscious that a lot of these things countries need to find a way amongst their own,
the people of power and influence of how to actually change things.
Now you can still don't think maybe we can do certain things.
And of course, you could say, well, we couldn't get them to ride the big shared commitments to big contract on development.
I used to start looking at little bits. This kind of this is actually the picture of the Millennium Declaration in 2000.
You just look at who's in the picture.
I mean, Vlad is there, but there's more people there as well who all were going to make a world of peace and prosperity and development.
And this is basically the declaration that is the basis of the Millennium Development Goals that later on became the Sustainable Development Goals.
These are the people that signed it originally.
I can assure you the several people that are now indicted by the International Court, the International Court of Justice,
the criminal courts that are on the sanctions list for good reasons over in the world.
That's not the way to go about it, it's nothing credible about as a way to actually do this, nothing wrong with it, but not a credible way.
Then the final thing here is like, you know, so what do you then do?
Well, if a country doesn't let you leave bargain for development, actually, it is easy because you just support them, you provide finance.
I'm not saying it's always like that, but if you just support them and you just do that.
And, you know, and and that's yeah, that's what you can do, it is easy.
And so you you should actually support them.
But what you do with with the countries without developed embarking on, what's the point of AIDS, you can actually ask yourself,
you have to be willing to be really critical if within the country they don't
really trying to actually make something sustainable growth development from it,
you have to be really a bit more critical about what you do. And so that's a little bit way I get to, but not entirely this things you can do here.
The book talks more about it. You can do things that actually strengthens doors, those in the leads that actually want to pray fairly so.
Yeah, we of works a lot on on illicit finance. These are good things to fight because actually they sustain a lot of bad political outcomes.
You can also get elite bargains that are supportive of growth, for example,
those who are really trying the hard way to grow their economy rather than from natural resources and export stuff.
Or in any case, you know, just make sure you understand the politics deeply and find ways of AIDS to nudge pockets.
So finally, here. For those looking to exist, you know?
Actually, my book is trying to be a positive story.
The fact that there is so much progress in these countries, it means there's more and more countries where we start getting the lead bargain,
where actually something is happening and we should be willing to support them and do this now.
We should be aware that we shouldn't say everywhere in the world things are going good.
So don't be naive about the politics.
And definitely don't try to say you have the silver bullet there of some magic bean or some technocratic solution.
As academics, as researchers. You know, we will be far more effective if we really try hard.
What what is it and where are we working here? What's going on here? What are we doing?
Is there actually a chance that this is actually sustainable and not thinking, Oh, well, we have nothing to do with politics?
I tell all the economists that I work with you better understand politics this fall because you won't be a good economic adviser.
I'll stop you. Thank you. So I just, you know, I couldn't in.
Thank you, Stephanie. And can you hear me? Yeah.
And I'll pass the words to Melinda for the first set of comments.
So is that OK? So my name's Melinda Berhad, and it's really, really nice to be here in front of you and to have the chance to support Stefan,
who has been a colleague for decades and who I've learnt a great deal from and who I must say I marvel
at your patience and your creativity in the way in which you can convey such complex ideas simply.
And I really commend the book. I had a few thoughts on the train up here that I wanted to to put to you all and looking out into the audience.
I imagine many of you are development studies, economists, political researchers in one form or other,
so no doubt have your head deep in theory and counter theory about development and progress.
So in what way is this conversation? In what way is this book helpful to you in that quest?
And the first thing to say about me is So I am, I am.
And I sort of bring the perspective of someone who has, like Stefan, been a practitioner in the field and who advises ministers on policy.
And I'm also a strategist by career.
So that's a skill and I've developed over time. And I'm bringing all of that to bear in this conversation in the context of Stefan's theory.
I find a huge amount of what Stefan says completely compelling in a way that integrates all of those things, which I'll go on to explain.
And I mean, exactly, Stefan says.
Over the twenty three five years that I've been working on, international development had a passion for it from very early on in my life.
The change and the progress has been really incredibly humbling.
I mean, it was illustrated, I think, up there in the graph to start with the downward trends on extreme poverty.
You know, when I was what was in 1980 was at 45 percent of the world was in extreme poverty.
Even before you get to the early 90s and some of those trends that you can then start to see in that graph unconceivable today for all of you,
I imagine to to experience to live in a world with that level of extreme poverty and
the change that has been wrapped around that in terms of social progress technology,
the shift in the world all different to multipolarity at the end of the Cold War, climate change and global public goods,
and the ways in which we think about the challenges of poverty reduction and development have been really, really, really incredible.
Actually, I mean, China's China's progress on poverty has been huge and a huge story and an incredibly humbling story.
Since then, since Millennium Development Goals were agreed. Nevertheless, it is also true that poverty remains in the world and and many, many people,
even if they have escaped extreme poverty, still hover around the poverty line.
Many, many countries hover around the low income middle income poverty line, so this isn't a challenge that's gone away.
And I would argue that the moral imperative to do something about it is still as presented as it ever was.
And what's more, it's more than morality, the security, the national security.
How do we want to promote the national interest argument is as compelling. Even more compelling, perhaps than a type of work was.
We live in such a rich world. It is ridiculous that people still live in these conditions.
So I would say that development studies as a social science, which you can call it,
that has really has struggled over the years to make sense of all of this, that, you know, the theory and the counter theories.
Stefan showed you a picture of all the books. I'm sure you've read them and you read them, and I'm sure you've read many more besides.
But it is hard to read in between the lines of many of those books and say with certainty that
we understand why poverty still exists in the world and why development is such a complex story.
And with that in mind, I just really commend the first part of the book, Stefan,
where you kind of go through these four propositions and then align different, different authors to each of those propositions.
For anyone that's studying for development takes on that is your cheat sheet. You can sort of map your own sort of analysis of who sits where,
but it really is a really good and brave attempt to to categorise who thinks what's now.
The challenge is, of course, and you mentioned it, Stefan,
is that the risk with all of that is that you take one theory over another, and what it gives rise to is fascism.
And this has been really true. I think in development and certainly in my experience, this is going to work.
This can really work actually. Now, if we just change it, that's going to work.
Girls education, golden thread of corruption in democracy and it's so easy to politicise that it's so easy to become one of the sort of the campaign
that jumps jumps on the bandwagon or drink the Kool-Aid or however you want to express it because development is so complex,
why not? The human mind just reaches for those easy solutions or those those political light motifs and really runs with them in a very, very emotive.
But I I must caution you all against it, because that simply is not how it works.
I find that development studies and development theory still does.
Fail to answer the question, what is it that we should prioritise and why do some countries and some people remain poor?
So what's my conclusion? I mean,
I agree with Stefan very much that what we need is is a dynamic framework that helps us make sense of why some countries succeed and why others don't.
Over time, you can have two countries with more or less the same starting position.
One takes off, the other does not. And the story is even more complex than that.
When you look into in the countries, some populations take off, some populations succeed and others don't.
So rather than having a framework which says, of course, it's all about this, it's all about that,
we need a framework which just helps us to think about and understand the challenge for what it is.
And it is a messy and the complex story. And things go wrong in you and you.
I'm sure with as professionals, as researchers working on development, you will try things that go wrong.
You will take risks that don't work out and you will understand how messy and complex the process is and the bad news that it can generate.
So, you know, political economy is not a new concept, right?
I mean, people have been talking about governance and political economy and development terms for a long time.
But the way in which the story is told in this book, I think, does really give us a quite a unique sense of how to bring these things together.
It's not a policy prescription. And I would really caution no one to look for that policy prescription and then stand behind it.
Because, as you put it into practise, as I say, it's far more complicated than that.
It's a way of understanding the world, which sounds sort of quite logical, I suppose,
but it is a way of understanding the sort of set of competing interests and factors that affect a country's development in a messy and complex way.
And I find, you know, and you will all know this from working in development that you know quite often you can feel
guilty about combining the politics and the economics in the social capital and the environmental.
You know, sometimes you're kind of the way in which you read into things will push you down one avenue or another.
And I really urge you and caution you all to really resist that and sort of fall into the trap of saying,
I'm going to bring this toolkit and that alone, because I think that's the thing that's going to work.
And this theory, this framework that Stephane offers, gives us a way out of that.
I think it gives us a way to understand the multi-disciplinary nature of development and what it and what it means.
And also and this is really critical. The internal and the external balance is not only what goes on inside a country,
it's a way in which that country interacts with the rest of the world and rather than seek to ascribe blame or causality from,
it's all about the internal politics,
but the external factors proving that colonialism or war with Russia between Russia and Ukraine, whatever it is, you might argue actually,
what we really need to understand is how those two things impact each other over time,
how domestic politicians are reacting to international pressures and international intervention, and vice versa.
There are some surprises in this, and I'm sure as you read it,
there'll be things that you don't want to agree with or you're reading for the first time.
So, for example, I found the analysis of China's and China experimentation and successes and failures in the very early learning from that.
It reminded me it really resonated from the early 90s when we were working on China, the late 90s rather.
And we're working on China from DFAT perspective and thought that China had the most fantastic development model.
It tried and tested. And then it rolled out what worked. Goodness, look where we are today,
but also the other really rich stories in the from the technocracy in Ethiopia and the
expertise on FDI and attracting that into the country all the way through to what I thought
was a brilliant elucidation of what happened in Bangladesh with the social capital
India and the sort of the bravery to experiment and use evidence of what really works.
So there's all there's something in that for everyone, no matter how much you think you know, a country.
And also, it allows us to see that even within those countries and examples,
there are multiple drivers going on at the same time as whether it's sort of peace and stability on the one hand, which you say is a precondition.
I certainly agree with that.
But that can sit alongside quite difficult and competing factions inside a government arguing for a fight for capturing elites, capturing rents.
You know, the tendency toward instability and towards the governance challenge is always there, even when you have peace and stability.
Now, none of this makes life easier for policymakers, right?
Wouldn't it be great if we did have a silver bullet and we could all jump on one particular bandwagon?
And as I say, what we need really as we approach development is a framework for understanding what goes well and what goes wrong.
Something that helps us bring order to the disorder even though we accept and are cognisant,
that will always be sort of challenged in our endeavour of understanding what's happening in a particular country.
But we do need a framework for which to start. And the more universal we can make that framework, the less patronising we are likely to be.
You know, you will know this, that the terms that we can use in development can be extremely patronising.
So let's have a framework which we can equally apply to our own country or European country or a western country as becomes a developing country.
And puts away the hubris, actually one of the best of my abilities to get rid of the term global south and global north,
I don't think that helps anybody, particularly not in this day and age, almost though interconnected anyway, so.
So what does all of this mean? How do we put it into practise? I might.
My three words I've written down here are patience, humility and bravery.
And I think over the 20 years, if someone were to ask me if they were starting out now in a career and what do I really need?
It's patience, humility and bravery and patience because these things take a long time.
Humility, because you don't have the answer.
We don't have the answer, but we just need to endeavour to try and understand what might work and bravery because there are very few people,
particularly in government, when I say this in a very personal capacity. In the end, the brave to call out when things are going wrong.
And that's why we've made many mistakes in development over the years because we haven't
been willing to say when things are going wrong and learning from those mistakes. And I will.
I'm sure there'll be questions about the sort of future of UK development policy, and I'm happy to take all of those.
But again, in my personal capacity, you know, a big debate about whether development is part of foreign policy or should it be separated.
You know, as you know, how do we integrate in the best way?
Is this about money? Is it about nought point seven or is it about political influence?
But I guess what I'd finish on is to say all of that aside, what I really hope we never lose as the UK, as you know, Oxford and other,
you know, universities who have some of the best expertise in the world, we must not lose our intellectual leadership.
And I do feel, as I said at the start, that development studies has lost a little bit of its intellectual rigour, rigour,
but sort of and what it really means and stands for and how development studies is really contributing to our understanding of the world.
Thinking like this really helps us advance that your own thinking, as you would as you absorb this, will really help to advance that.
We need frameworks like this to help us not understand, not only understand what's happened in the past, but what's going to happen in the future.
And so I sort of really, as I said, I commend the commander's analysis and what sits within it to all of you.
And as you sort of think about career and development to try and keep that sense, if we don't know what's going to happen, it's messy.
But we we do as a collective need to be thoughtful, brave and take risks.
That's the best advice I can offer. David?
So thanks very much for coming. Thanks so much for inviting me, so I really like this book.
And partly because I think that you had a lot of Asian countries and African countries in the book,
and it's a comparison that you don't often see, but one that I found very interesting, partly because I spent 15 years in Asia for the F.T.
And one of the things that you realise when you spent a lot of time in Asia is that it's
proof that you can go from being a poor country to become a middle income or a rich country.
I mean, I lived in Japan for a long time, and the Japanese were told by the Americans after the Second World War, you should make beads and silk.
That was the development advice to Japan. And they said, I think we'll make cars and electronics.
And you saw lots of countries, you know, follow that model. You so Taiwan in Seoul, South Korea and China.
Now, Singapore, Hong Kong and I come from Asia, where countries like the Philippines,
for sure and even Malaysia were considered the kind of the failures and the basket cases.
And then I arrived as Africa editor of the AFC and made this kind of Africa rising hype.
Which I think it was, and I was struck in many countries that I visited, certainly not all,
but by, in a sense, the kind of lack of seriousness and ambition of many of the elites.
And I like this book that it pins things on the elite so that there's a caveat to that, which I'll explain later.
But I was I was also struck by sometimes the kind of lack of seriousness or the gap between what was being said and the reality.
So I remember and being a big sort of delegation from Nigeria talking about all the fabulous investment opportunities in Nigeria.
But the truth that people who tried to invest in Nigeria know is that it's really, really difficult.
There are all sorts of obstacles in your way.
And there was just this kind of disconnect between the the narrative that was being told and the real story.
I mean, once I was asked how Nigeria could get more tourists, one of my first answer was, Well,
you need to put a box on your visa form that says tourists, because there's no such books.
So you cannot go to Nigeria as a tourist, you have to be invited by somebody and says business.
So this is kind of proof that there's a lack of sort of seriousness there.
Again, I'm not blaming Nigerian people at all and blaming the Nigerian elites, and I would like to quote Fela Kuti on VIPs who of course,
are by the bones in power and unless proved otherwise, I think that's how they they need.
They need to be seen. And I think that this book is a very hot.
It's clinical and hardnosed book, and I like it for that because they can be too much kind of fluff around these questions.
So, you know, we know when the country is doing well and what what I think Stefan's book is about is about take off.
It's not about becoming, you know, a perfect liberal democracy and everyone having a wonderful time.
It's about the conditions where you begin to take off as a nation going from poverty towards something that looks like you might be going somewhere.
And how can you tell where you can tell through data you can tell through GDP per capita?
I mean, I wrote a whole book about how GDP is a silly measure, but it does tell you something GDP per capita that tells you something.
So does child mortality when that goes down fast.
You know, things are improving and the fertility rate more controversial.
But when the fertility rate goes down fast, that's a marker of all sorts of other things.
Women's Education Agency, you know, access to education, all sorts of things.
And I think that this is the I think I mentioned this book, but I certainly would mention it.
I think, you know, the Amartya Sen definition of development is a very useful one.
It's when people have agency over their lives, it's when they can do. They can make choices, what they want to do with their lives.
And those choices are made for them because they don't have any opportunity or agency
over their lives because they're too poor to blighted or to beset by instability or war.
And so, so agency is the crucial measure, I think.
And while I really liked the simplicity of the book in this and the theory,
which is basically you need an elite organ that is driving towards growth and development.
And I thought that was the strength of the book.
However, I did kind of want to add two things that in my head, one of them was this idea of the nation state.
And I think nations that have a kind of a strong sense of nation state have a huge advantage.
And again, I kept saying this in Asia, a country like Vietnam, you know, Japan and Ireland, Korea, which wasn't China.
I mean, you know, these sort of national mythologies are incredibly important.
And of course, that is one explanation as to why many African countries are yet to to take off in this definition.
I think because of course, they're the colonial constructs.
And here, I think that the colonial legacy and what's been done to Africa by by principally Europe is of real concern.
Of course we are where we are and leaders of, you know, Ghana or Sierra Leone or Cote d'Ivoire or wherever,
you know, have to start where they are and make the best of it.
But still, you know, this sense of nation state, I'm actually I think that the fact that, you know.
Many, many countries that were, as I say, these kind of false constructs are beginning really to feel like nations and sort of,
you know, you do get a sense of pulling together, I think is actually a hopeful sign.
The second thing that I think is missing is too strong, but but something that I was aware wasn't there, let's say, is the people.
And so this is definitely a book about elites. And as I say, I like that simplicity, and perhaps I have a kind of romantic romantic idea.
But of course, people can help shape their governments. And you see it.
So Ghana, one of the, you know, relative success stories in Africa, has an extremely strong civil society,
and I've seen it in action during elections where they hold their elites to account.
They say, you elites will not steal this election. We will vote for you.
And if you're good, we'll vote for you again. If you're bad, will kick you out.
It's a perfect definition of democracy. I heard that on the streets of Ghana again and again.
So I think, you know, sure, I understand the elites and the powerful, you know,
they have certain advantages, but I don't think we should forget and the people in all of this.
Let me just end because I want to stick to my allotted time.
And just to say, I think this is actually quite a hopeful book in a funny way.
It looks very kind of hard and tough, but it's hopeful because it says, you know, some countries,
Bangladesh being a very good example, actually, which we don't think of as success because we tend to have a sort of lagged.
But Bangladesh, through textiles, you know, the tragedies of Rana Plaza, notwithstanding through remittances,
the tragedy of people having to leave their home to send back money notwithstanding.
And and some of the big NGOs, you know, like the Grameen Bank and so forth has led to, you know, 20 odd years of pretty fast growth.
And if it's all you need is 30 years of fast growth and you were really in a different place,
it's very hard, just a few people to to dominate that will that will tend to spread wealth.
Of course, you know, there'll be unequal societies. I'm not claiming they'll be perfect societies, but if you have 30 years of growth,
it's very hard for for, you know, a few people to to monopolise that.
So I think this is a book actually of agency.
It's a book that says no matter how bad and the history that you've been dealt
and if certain things come together and if certain people make certain choices,
things can happen. You can have, you know, these what we call economic miracles.
They don't. Those economic miracles don't solve everything. There's a whole political democratic dimension.
But they do begin to address the amounts of sense and a sense of agency.
And once a country takes off and reaches a certain level of prosperity, you know, then then it can go further on.
But at least it started on that journey. Thank you, David. Thank you.
Stefan, we could either open the floor immediately or you can just address for two minutes if you want to quickly.
No, I will simply say to thank these comments and it's actually really good.
And Melinda, this advice I've received is down and I I totally see that actually.
And the patience, humility, bravery you should definitely remember.
It's really useful, but also the need for, you know, getting some universal frameworks because it's less patronising.
And I think I'm really sympathetic with the view.
And on David's point, one thing I don't do in the book and I accept that entirely.
I'm just so really quite fun, actually the book, so I could have done more.
But there is something that I also like your point on the the importance of a
national narrative and of how it could be the nation's national national narrative,
so to speak, about nationality, about the nation state. It could be another narrative.
And there is there is really something there about, you know, how do you how amongst, you know, elite players,
the communicators within it, how do they actually actually articulate and actually help to shape this?
And there's more to be said about it. At the same time, I like your point and I totally take it on the role of the people and it's garner.
Is this really interesting? People place there because, you know, and there is a lot of research and really good evidence that over time,
within that development bargain that I think no doubt in the 90s was largely shaped by people in the lead.
People are also responding by voting for the right people, so to speak, if I put it in inverted commas,
the right people that became much more outcome based politics and so on. And then finally, both comments are being made.
You know, there is a hopeful story there. You know, there's lots of places that suck at actually places that looked really bad.
You know, Henry Kissinger used to call, or at least the adviser calls Bangladesh a basket case as late as nineteen seventy nine.
Nothing was going to come from this place. And you know, a lot of things that some of the more surprising places can do.
OK, thank you. We have just under half an hour for questions, so it should give us enough time for interesting exchanges.
Please keep your questions to make them very brief and preferably questions rather than comments.
But whatever you do, just keep them. Keep them brief. And we'll start with you, Molly, who's just the microphone?
Yeah, thank you. From the Oxford Department of International Development. A great book,
and I think in a way you take the focus away from a binary distinction between autocracy
and democracy or extractive versus inclusive institutions and bring politics back.
But I have two questions very quickly. One is that there is prior work on the role of coalitions and political science.
There's work in development economics by people like Mushtaq on political settlements, land projects.
In what ways is your work really different or is it just repackaging some some of those similar ideas?
And of course, some of the challenges that we have for the prior literature might also appear in your work.
For example, we know very little about how countries make institutional transitions from poor to good institutions.
How do countries move from one type of leapfrogging to another rents the idea of rents for sort of missing because of course,
rents are crucial to sustain elite bargains. Right.
And also for four dominant coalitions.
The second question very quickly is that you mentioned outsiders now in a lot of context that I study outsiders insiders.
They reinforce plea bargains. I mean, Lebanon is a classic case study.
It's very difficult to form a government and it doesn't form, usually without some outside intervention.
And there's, of course, asset mobility. Ricardo works on that topic today.
There's a great paper by Gabriel Zuckerman who talks about offshore tax havens.
Now this asset mobility sustains. Elite bargains in some ways are fragile post-conflict states where some outside settlement is important.
So how does your work really engage with those questions?
Thank you. These are huge questions and really, really important ones.
So we pick up three questions and then we'll. Hi, can you introduce yourself?
Hi, Stephan, my name is on my page in international development.
The question is quite quick, so you talk about some of the alleged bargains that might be growth or development in using.
And I wonder in the countries you study what makes certain countries, the elites in certain countries,
more disposed to settling on elite bargains that might develop induce development as opposed to ones that may retard the development?
Thank you. And another one and one from one line.
Yes, Cowboy, you will have. Nigel says the implications of the lecture is that there is a binary division between countries,
governments who have a development bargain and those that don't.
Clearly, this is simplistic. How do you draw the line and what does that mean for overseas aid budgets?
Those online questions are always yes. Yes.
So, look, these are all very, very, very big, big questions, and maybe others here on the panel will help you out.
So, so, so on the points that the deal makes.
Actually, it's interesting that all the authors that you citing the XDR, they are used in the book and there are definitely parts of it.
And then I mean, all the way from from www.shutterstock.com to Zuckman and so on.
And you know, the. But but it's I think there's three key things.
The idea of rents within the system is, of course, crucial. OK.
And I think I tell the story of Indonesia.
Where in the nineteen seventies, early 1970s, where coming out of conflict as well and lack of legitimacy of the new president,
there's a real balancing act in terms of opening up for the Japanese investors.
And at the same time, keeping the old elite on side. Indonesia remains a very corrupt country.
You can definitely understand it as actually as a way you needed to get these two parts to work together because on the one hand,
you open up the alley parking, you allow it to gradually shift and in fact, Suharto.
It's almost like kamikaze, because by 1979, it had opened up so much that he was kicked out as well.
But you need to do that, you know, you need to do that, so you need to keep. The Alderley there, and all was the best example is.
The wives also have to. Who is called Madam 10 cent, which 10 cent actually 18 cent in Dutch, the old colonial master means actually 10 percent.
And so she was nicknamed Madam 10 percent.
So actually, to keep this transition going, 10 percent of all the infrastructure projects have to keep flowing to their.
So you have parts of it. So I I answer in that sense, trying to answer at least one go two questions to some extent.
You know, these plea bargains evolve. But the important thing and what I sometimes find a bit hard in someone's political settlement work.
Is a sense of predestination, as if there's just one equilibrium that you should settle on.
Now, one of the things is, and I was really glad that that tells us that the panel picked it up as well.
There is agency here. Now, it's not it's really hard to make coalitions.
But coalitions are being made, and I I'm not a big monster of how to make the perfect coalition,
but actually those countries that are actually masterful in terms of manoeuvring their parking.
Knowing this kind of spirit of political error correction knows of how to actually do this, and that's what we see now again.
I can't be prescriptive and say this is the ingredients for the perfect coalition.
But I have admiration for those who actually make this, and in fact, in the book, it's another piece that hopefully will come out soon as well.
It's actually technocrats play an important role there,
so very key technocrats who can almost name them in many of these countries, who wasn't in Indonesia, who wasn't in Ethiopia,
who were the ones that actually the ones that broke or treat our kids and let it evolve and
actually make the links with the outsiders who actually can be infecting many of these countries.
These were economists linked with the IMF sometimes and played the game of the IMF very sensibly when crisis came and so on.
So there is actually agency here, I can say more and so on. I refer to the book, but it's there.
But finally and finally, we can talk.
Talk more about it there, but link to this this other the second question in terms of, you know, where do they then come from?
You know, where do what? How does a country central from?
So I give you a suggestion already is because they're individuals and they don't have to be Lee Kuan Yew.
They don't have to be the leader.
They can often be people in the in the in the backrooms and so on who actually forge the coalitions that can actually be sustained.
You know, and you know, Ghana is not simply Jerry Rawlings delivering this plea bargain.
Absolutely not. It's politicians.
In the end, learning and finding a way of within the confines of the Constitution get political transitions to work and so on.
But there's other things as well. Bangladesh, definitely.
It came out of conflict and chaos in the 1970s that actually choices were being made, and I have to be careful with other people know more about this.
I think there is an element of that tension. I definitely it is.
They're coming out of crisis. But also how ask yourself, how does the Communist Party survive?
And it needs to seek legitimacy so you can actually coming out of conflict.
These are moments. There's plenty of countries come out of conflict and don't do anything with it.
Actually, some countries will come out of conflict and actually it's the moment, you know?
I would say let's hope Ukraine can come out of conflict at some point and take its moment.
It's not guaranteed given the history of Ukraine and the nature of the society, but you would hope so and you can see that, you know,
this is a moment coming out of conflict at some point that you can take it, but it can also be because you look for legitimacy.
Ethiopia was speaking both times of conflict, but actually relatively speaking, a very small ethnic group came to power.
The game is represented at the time, and I have to be careful if they don't like you two to describe it,
but you know, they are ultimately linked to a particular ethnic group and so on.
So you can actually go developmental because you are looking for legitimacy and so on.
So finally, yes, it's simplistic. Look, I was complimented on the panel of actually trying to actually be relatively simple
in terms of communicates with the way the framework and I do this consciously.
There is no country that is a perfect development bargain in a perfect non-development backing and these elements.
In fact, I talk in the book about Kenya, Uganda and I put actually a table there in the middle that seems to be evolving.
I actually just want to appeal that you actually question yourself and actually saying, you know, where is this?
And how do we think about the politics? And I'm actually happier if people start debating and saying, this is not trying to right here.
And maybe it's more rungs here, especially those who as outsiders get involved rather than simplistically saying,
Oh, this is perfect or this is not perfect and an analogy to Africa.
Thank you. And we'll go for another round of questions.
I wanted to remind the audience that there will be books for sale outside black holes is there and there will be drinks, most importantly, at 6:30.
Who would like to? So there's a question there.
Hello, yes.
James Dixon from the Transport Studies Unit, So my question might be doing it down a little bit, but this is around around the the early bargaining.
So I just wondered, and to what extent does it matter who the elite are?
So we've been speaking in terms of of.
Perhaps the social elite in the case of Nigeria, from whom you quoted Fela Kuti and we've been talking in terms of things,
as you mentioned Russia and I guess that of the formation of what we'd call the oligarchy and in fact, the guy for whom your institute is named.
I guess you could call these a form of elite bargaining tools and I guess flash forward a few centuries.
And we have these massively powerful multinationals and I guess our elites are now the angel investors and the for want of a better word.
Silicon Valley grows who are moving vast swathes of capital around the globe for these things.
And I guess to contextualise this, I was privileged enough to spend a week and a bit in Nairobi last month,
and I was meeting a lot of people in in start-ups,
I guess, who were involved in this, specifically the immobility of electric motorbikes, electric mini buses in in Kenya.
So and it dawned on me that none of the people I met in the senior positions with these countries were Kenyan.
They were all from America or Britain or Sweden or Germany or whatever.
And this kind of is making me think in reflection of the talk you've given us to, to to in this instance, are they the elites making these bargains?
And to what extent does does it matter who it is?
Thank you. It's a good question. Is there another question from the audience?
I'm sorry, there's one here, and then we'll get the next the third question.
Thank you. Hi, timidly, I'm a. Consultants.
No one, you you hesitated there. I'm trying to think of a grand title, but I don't have one former defence which informs my question,
so I haven't read the book, but I will and I'll go and I'll go and get one for me.
The framework you're talking about, I think, is very interesting.
A lot of it resonates with my own experience and kind of understanding of how the aid sector operates.
And I really like also that the patient's humility, bravery, kind of the key takeaways.
I think for me, one of the things that really resonated from what you're saying was around the ability to course correct the
ability to kind of recognise when things are working and not working and and kind of adapt as we're going along.
My question and you kind of touched on it,
but I'd be interested to hear a little bit more is how well do you feel that the international aid system embodies those
kinds of principles and and you is set up to genuinely actually kind of incentivise that kind of developmental action?
Thank you. Thank you. And I'll use my prerogative as chair just to ask a quick sort of writer on that when you speak about outsiders.
Stephan, I'm thinking of specifically a couple of people you put up there.
It's not just that their policies failed is that their policies were malevolent in terms of the consequences for the societies,
sometimes out of sheer ignorance and arrogance, often because of ulterior motives and also thinking of the centrality of, for instance,
of illicit financial flows and in particular the role of the City of London and
its overseas territories in scooping up a lot of money from the global south.
I won't use the expression too much.
So beyond is there a strong do no evil agenda which would be as central to our actions as the actual proactive actions themselves?
And if so, how do we look over the last 20 and 30 years of actual?
If you will see the quote unquote western policy on those big issues of development that your book focuses on?
And Claire, I've got two quick questions on elite bargains online.
One asks How do you know that you're defining the leapfrogging for development independently of successful outcomes?
And the other is a related to David's comment on people holding their leaders to account.
Does the book book engage with development agencies and international institutes propping up failed Alipay bargains?
Did that make sense? It did. Maybe not for me, but I'm good at the so I leave the last question until this answer because I didn't quite hear it well,
but so, so so so the first question.
It's interesting to get to the Kenya example, of course, and you know, the venture capitalist space in Kenya, it is shocking.
You know, 60 70 percent of the venture capital goes to Americans in Kenya.
So we all say it's a massively dynamic place, but it's basically people come in there and capture all of the money.
But if you ask a really good question, who is the elites? And but you also qualify that.
So does it matter who it is? Now I have a I think I can define the first one and the second one I find intriguing for myself,
and I'm not sure that I have a clear answer, and I don't think I answer this in the book.
So the first thing is, you know, who is the elite was people with power and influence.
But the main reason why I want to talk about the elites that I don't want to talk about the politician,
the leader, the minister of policy, politics and so on.
I don't want to reduce it there.
That's why I keep on actually sleazy people in the economy that just this past, because the politics and the economics is totally connected.
It can be the other people there in the military and so on. And so so that connectivity needs to come out.
So that's why I actually went for the idea of talking about it rather than actually seeing the
political class or the politician because it is broader at this people with power and influence.
And then we can start defining who are they? But also, how do you get into it?
And I alluded to it earlier. It evolves all the time.
And in fact, to help them bargain, I think typically will involve opening the door for newcomers to come in.
If you if you really strongly want to go,
say in the land picture kind of worlds of thinking about it where he used this classification and a little bit like,
Oh, you make it open and now it's all will start happening. I think it's a bit more gradual.
It's a bit more it gets it's built in. But again, that example, Indonesia,
they actually fundamentally probably started undermining the early bargain that was actually
that existed by getting all these new investors in in Bangladesh is a great example.
Initially, the government investors were outside this, very much so, and they it took them 20 years to become the insiders.
And now actually, a lot of people say Bangladesh is maybe not going to continue to be a success, and I'm not going to speak out on that.
I don't know. But actually, now the garment industry is probably now the most blocking in terms of economic policy and economic renewal.
So that's 25 years later. And so you get this so you get this evolving thing of of who is in, who is out and so on.
It's there. But but I appreciate this question. I'm not fully answering it and I get it.
So the second question is the party, the international community ability, a willingness and so on and then ask for is actually short.
You know, you ask me how to look back at this and their ability to do it and then say, Oh, the terrible, it's fast.
And it's not because of will end or hopefully not with me, but it's actually, you know, it's you know, we are when we are, we did it.
And I think, you know you and if we would recognise all the time that you know,
you get pushed to magic beans, to silver bullets, to grandstanding, to all kinds of things.
And it's actually really hard to do this kind of patient work with humility because everything has to be a success.
You know, there's no humanity possible. It has to be declared to success even before anything is done.
And then the final thing could it's yeah, this commander is on the course correction.
I think the crucial thing is actually not the outsiders, the aid.
I mean that that that in the book is a kind of a minimal part that the whole thesis of the book really is.
This happens internally. It can be helps nudge the loan.
It could certainly be hindered by outsiders, but it's basically it's an internal pact.
And on the course correction, I mean, there are two two things to quote. One is banks helping, you know, crossing the river by filling the stands.
You know, this is very much so. They didn't know what was going to happen.
They felt the stones as they as they went along. And that was they slipped up and they they mucked up.
And but they, you know, headed towards the other side, at the very least.
And the other very important thing is data, which you mentioned in your book Bangladesh very strong data.
You know, if you don't know what's happening or if you don't care what's happening,
if you don't count who's dying and of what or how many mothers die in childbirth or whatever, then you don't have a policy.
So data is very crucial for course, correction.
And that's why it's great to have people on the panel to actually give you the better answer than I was because actually aids,
even though I talk at the end about what outsiders can do, it doesn't happen.
It doesn't appear until then until very much towards the end the stories of these countries.
These are largely about what's happening in there, and it has to be done about it, so.
So maybe they are just commentaire on the on the, you know, first of all, I do not subscribe of the ignorance thesis of of about policy making.
It is deliberate deliberately most of the time.
I think a lot of of the bats of the malevolent policy maker, it's it's deliberate and not makes it even worse.
And I think in order to do no evil and calling them out, and I hope in the book to give let me just name a DRC in Nigeria,
Malawi and Sierra Leone a hard time because I do think, you know, there is huge responsibility there.
And at the same time, of course, what you talk about, you know, us making, it's making history for it.
I was I was this morning thinking of how do I get a bit more of this thing on Twitter?
And I was thinking of running a quiz,
and one of the questions is going to be which London firm was most complicit in the Gupta brother scandal in South Africa?
Which is exactly. That's the answer. Every day is fine.
Any, any, any law firm or accountancy firm was involved.
So. So I have not named it. So I have not live with myself.
So that's right. But the thing, OK, there is there is the comment here about the successful outcome of a defined it.
You know, look, I'm actually now going to use the Ethiopian defence.
I will still say that Ethiopia has in 2005 to 2020 develop a party, even though possibly it will all unravel.
A conflict came and the plea bargain wasn't strong enough. But I do think that they were trying to do it.
It wasn't inclusive and there was all kinds of issues with it and politically it didn't look it looked quite ugly.
So when the question comes, you know, how do you know the risks? One, you know, that's the first thing you all.
You know, you don't know. You think recognised, but maybe more important to come back to the gambling points.
Why don't you use the benefit of the doubt and actually gamble on a few more and actually give them a chance?
And actually, I find it very striking that if I look at this stuff for a moment, look at international sides.
We're very good at very quickly categorising places in particular camps.
I spent two weeks in Cambodia until last week. You know, it's vilified and it's not a very good place.
But my God is in development indicators. The progress is actually really striking and I don't know one LDC country that
probably will graduates out of LDC status with income poverty as low as Cambodia has.
But meanwhile, everybody has sanctioned them left, right and centre.
And so then you ask yourself, you know, are you actually willing to give them a chance to gamble?
And yes, they're not perfect and all kinds of things wrong with it. But you want to do this?
And then the final question that you all understood and I did and maybe someone else,
I thought the final question from the online audience was whether that of accountability
also included the foreign agencies that come in and blunder about basically.
I think that that was the gist of the question is, yes, they do blogging about it.
And are they accountable? That's the, you know, it's a really good question.
I think I'm often just to say I'm thinking of the conversation we had briefly before coming specifically
about about post-Soviet economic policies and some of the people you put up on your slide.
What does accountability look like when we know what that trajectory was like?
We know we can name people who advise the Russian governments to do the liberalisation at the time and that particular way,
and they happened to be someone who wrote a book both ends of poverty and and it includes some others as well.
So, you know, there is. Is there any accountability for that?
No, and we should be very careful. And I think it's all advisors who we have.
We, as academics, typically have very limited accountability for anything we do.
And maybe I'm not saying we should put anyone on trial, but there is a sense of, you know,
being willing to accept that actually you don't do the right thing and agencies probably will do that as well at times and qualitatively.
So you don't have a good example, and I've diplomatically mentioned it's one of them.
Yeah, I think we have the time just for a very quick round of questions.
So there are three questions here. If you can make them extremely brief because we have to wrap up.
Students at Kellogg, Peter Hinton's My Name. And can I just refer back to Dambisa Moyo, who I think in 2010 in her book,
which was on your screen, it is that advocated stopping aid altogether and seeing what happens.
Do you think the panel, whether we'd be better off actually saying, let's have a five year period of no aid and seeing what happens?
Thank you. The other one and then the final one here. Thank you.
I'm wired. I'm a postdoc. Here was.
My question is if in 10 years, we will come back to another session asking why countries are not striking a development bargain?
Why not? Why aren't they gambling on it? Because we have had this round of one wish every decade sometimes.
Why aren't countries gambling on if we can predict if there are some answers to that?
And there's one here and is there one online as well? OK, I just want to go back to the slides where you had the books and.
Fortunately, unfortunately, I've actually read all those books.
And one thing that I keep picking up a thread that I keep picking up is the fact that there's a great disconnect between,
you know, writing the book and speaking to all the policymakers and writing the book and speaking to,
for example, I'm Nigerian, speaking to Nigerians who are on ground, who are the beneficiaries or victims, depending on where you're standing.
Said policies So one thing I'm starting to question every time someone comes up with a new book
is to what extent do you go beyond engaging with the vice president and actually engage with,
you know, the people on the streets?
I don't know what a better way to put that is, but to to actually engage with the people who suffer or enjoy the, you know,
the development policies that are made versus, say, you know, the vice president who's just, you know, doing whatever.
Very good. Thank you, Clara. And a quick one on line.
Jane has asked, What are your thoughts on inclusive wealth as a measurement of economic growth as opposed to GDP?
And might this change any of the patterns of growth observed across developing regions?
So we just ask Linda and also David and an end with things and so any any final comments or any answers to these.
So I like the why not gamble question. I mean, I think at least don't gamble when they don't need to when they've got a perfectly good thing going.
You know, I remember being in the Philippines and being someone's house and there were like 50 servants.
And I remember just thinking, why would this guy want these people to be wealthy?
You know, he likes them exactly where they are.
And, you know, if the elites have it good and is the kind of stability, I think they carry on in a simple way.
I mean, elite leapfrog and the growth and development is let's make the pie bigger.
But that's a gamble. It's a gamble because it may mean that you then lose power because all these new people come in and kick you out.
And the other bit of the gamble is it may not work. I suppose the inclusive wealth, as I say, I wrote a whole book on this.
I mean, you know, for sure, you know, you know, if you have, you know,
the GDP per capita doesn't tell you anything because you don't know how it's distributed.
So you know, you can look at mean income or you can look at some of these other statistics that I mentioned, you know, child mortality, et cetera.
I mean, if all the wealth is going to a certain number of people, well, that's not, you know, and the country's growing very fast.
Equatorial Guinea is not a bad example. You know, that was oil and three people spent it all and sends it to Paris and Switzerland and wherever.
You know, that's not an elite bargain worth having.
That's just extraction. And so, yes, absolutely. If growth is not inclusive to some extent, it's not going to be perfect.
It's not perfect in Britain. God knows. But if it's if it means that more people have a chance of agents, it's come back to that.
Whatever you want to say, a dignified life and then some, then you know, you know, something's working.
So I wanted to take the question about, do we think that it be a good idea to just switch off aid for five years, will that be a good idea?
So I definitely don't think that fiscal transfers in the form of free money from donors to developing countries is the answer.
But I equally think that development, investment, development, finance, particularly climate finance investments, is really important.
I also think that when the humanitarian crisis or disasters strike, you really,
really want to make sure that you have a risk pool so that the pool that supports people when they're going through the worst forms of suffering.
So it's not a yes or no. I guess I would say the industry that's built up on the notion that developed
countries owe a certain amount to developing to pay for their development is wrong.
That's that's over. And it should be. And in its place, we need an answer, which is more about the development finance system,
which supports sustained growth, sustained and sustainable growth.
And this has become so politicised, as you know. So the question and the challenge for us all is how do we get from what was to what needs to be?
And I also just wanted to quickly ask the question on accountability.
So it was a great question that the Nigeria case, I mean, and colleagues in the room who I recognise have worked with us on this.
Goodness, how have we tried to bring in forms of accountability to the way in which we design aid programmes that just goes beyond those
conversations we have with government into the conversations that you need to have with such a broad range of stakeholders?
And this is where the data point is really key, actually, because data tells you so much of that story.
And you just need to be extremely skilled and and have the presence on the ground and really savvy people that know
what they're doing to get out of the clutches of those sort of captured conversations into a conversation about,
is this intervention or is this policy making a real impact? And how do we know it's the really the best form of investment?
And many people far wiser and more experienced than I have tried and bashed the head against a brick wall.
But I mean, for exactly the point, you raise the hypocrisy of not doing that, just to say this is really critical.
Thank you, Stefan. Final words. So just quickly, flex your quickly on this in this point.
So. So the final one on the growth in the wealth, I think David Answer did very well.
You know, in the book, I work with the data I have,
but there's all the time trying to emphasise the the other indicators of of of of do with poverty, with health, education, fertility and so on.
You want to do this focus on increasing wealth, if we could measure it, if we could have the data, I would love to do it.
It's there at the eight. No. Eight is an interesting point.
So. So you know, there is definitely in countries where there is some kind of development bargain going on.
You know, actually, it is quite beneficial. I will I will.
I mean, there's no I mean, Hussein I've seen wrote an excellent book The Eight Club on Bangladesh.
It's a great book and actually AIDS is part of the success story of Bangladesh.
It is actually really being being part of it, Ghana.
It was very important as well. So we want to be very careful.
I want to be more careful and find ways of being sensible and selective.
I don't think we should have given to do that much with Kabila in the DRC.
We I would be cautious in Nigeria to actually spends a lot on health because the government can't be bothered spending anything on health.
And I actually worry about that. You actually give them an excuse. So I want to be more careful and saying conditionality.
In the book, I write a lot about that that I really don't like that.
But you want to think more carefully about what is the impact of the things that I will be doing so.
So, you know, is there still some time for it? I think yes.
Not least at this point. I then said earlier, these technocrats that you have there, you can actually strengthen with the aid.
If you're being very careful, you can actually support them with the things they really want to do and the kind of productive things.
But just be very, very careful. So should we be doing this in 30 years from now?
I probably don't think so. So you kind of think, you know, it comes back.
But why is it? It's not not gambling. It's disruptive. And why should you?
You know, if I have about $500 per capita of oil rents in Nigeria per person in two minutes and 20 million people,
you know, if I can divide it up amongst 100000 people, I'll be really rich amongst the 100000 and I've defined Nigeria.
You know, why should I do anything else? I have a wonderful life. I have these rents that I can capture.
Come to it. Do I talk enough to ordinary people? You know, it's actually really glad you asked me because I was this afternoon looking for
pictures and I realised that I never liked when I went to the villages and
doing the studies and talking to people actually to have pictures taken because
it's always the white person with a with the well-dressed into the village.
And I never I don't seem to have them. But actually, one point I always made a difference and I don't want to sound saintly.
It's for self interest. That's why I like to show you. But if I visited the capital, I always said, I want to be in the village as well.
And I would only go to a country if I get the chance to actually go in the village. I'm a cultural economist.
I love hanging out and talking about the livelihoods of people who I consult.
I don't know whether I can do. I give them a voice? I hope here and there as well.
But it's it's it's a good point and others have commented on it.
And I think it's the kind of thing, you know, I think I take away actually from this, you know,
probably the next book, let me probably turn the tables and actually the one, and it should be about.
And what do the non-elite now do? And I will be very happy to to talk about this file and I think have some good stories too.
But meanwhile, the book is what it is for now, and I hope you enjoy. Thank you very much.
This has been such a such a great panel. Stefan, congratulations again on your fascinating book.
And thank you to the panellists. It's been a really pleasure.
Drinks and books are also. Thank you for us.