Development economics has produced a substantial body of evidence on what does and does not produce lasting improvements in people’s lives. This evidence is directly relevant to the reparations debate, where the implicit promise is that payments to Caribbean governments would benefit the descendants of enslaved people.
The evidence on government-to-government transfers is sobering. Large transfers to government budgets frequently fail to produce proportionate improvements in welfare outcomes, particularly in countries with governance challenges. The money arrives, creates fiscal space, and may fund some government expenditure, but the link between the transfer and the welfare of ordinary people is often weak and indirect.
The evidence on direct transfers to individuals is considerably more positive. Cash transfer programmes, microcredit schemes, and direct service delivery have more consistently demonstrated welfare improvements for specific target populations. The difference is accountability and agency: when individuals receive resources directly, they spend them in ways that reflect their own priorities. When governments receive resources, they spend them in ways that reflect their political priorities, which may or may not align with the welfare of the poorest citizens.
A reparations programme designed around direct transfers to identifiable individuals, with clear eligibility criteria and transparent distribution mechanisms, would have a better evidence base for producing welfare impact than the government-to-government model CARICOM is proposing. But CARICOM has not proposed this model, presumably because it would reduce the role of Caribbean governments and constrain their discretion over how the money is used.
