War reparations have been a common feature in peace settlements for thousands of years. The chapter provides an overview of how historical reparations were paid, and then an overview of the literature on the transfer problem, one hundred years after Keynes started the debate. Whether direct transfers of money or indirect transfers of assets, transfers affect trade flows and future income in the short or the long run. Financing a transfer is a budgetary problem in the short run, and if a country can borrow the money, the constraint is a willingness to pay, not the capacity to pay. But a transfer can also have second-order effects on savings, investments, consumption, and output, because interest rates or the terms of trade might mitigate or exacerbate the economic costs of the transfer. I show that the terms of trade, for the most part, improved in the years following the announcement of reparations, and that sovereign debt markets allowed countries to finance reparations by borrowing.

This chapter addresses the question of funding the operations of the United Nations. It reviews the early history of UN funding and the systems that emerged as a result of the constraints that the UN Charter imposed on its members, with specific reference to the jurisdiction given to the General Assembly on budgetary issues under the one country–one vote system. The structure of the UN budget is also reviewed, as regards both sources and uses of funds, with updated data for 2017. The history of various funding mechanisms put forth in the postwar period is analyzed, including: Grenville Clark and Louis Sohn’s proposals contained in World Peace Through World Law; an examination of the advantages of the model currently used in the European Union, which itself evolved over time into a system of reliable, independent funding; a discussion of the merits of a Tobin-like tax on financial transactions to fund not only UN operations but also other development needs; and a system that would allocate resources to the UN as a fixed proportion of each member’s gross national income (GNI), without the multiple exemptions and carve-outs that are in place in today’s convoluted system of revenue generation.