State-building—the creation of new governmental institutions and the strengthening of existing ones—is a crucial global issue. Weak or failed states are at the root of many of the world's most serious problems, from poverty and AIDS, to drug trafficking and terrorism, to the failure of democracies. While we know much about state-building, there is much that we do not know, particularly about transferring strong institutions to developing countries. We know how to transfer resources, people, and technology, but well-functioning public institutions require habits of mind and operate in complex ways that resist being moved. This is an area on which much more thought, attention, and research must be focused.