A Proposal for Monetary Reform

James Tobin

Eastern Economic Journal, 2003, vol. 29, issue 4, 519-526

Abstract: Exchange rates fluctuate very rapidly, in comparison to the prices of goods and labor. An internationally uniform tax on all spot conversions of one currency into another would reduce these fluctuations. Foreign exchange markets focus strongly on the short run, but this tax would reduce these fluctuations by increasing the cost of such transactions. It throws some sand in the wheels of short-term speculation while increasing the relative advantage of longer-term international investment flows. [Ed.]

Keywords: Monetary; Policy; Tax; Taxes (search for similar items in EconPapers)
JEL-codes: E44 E64 F32 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (2)

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Eastern Economic Journal is currently edited by Cynthia A. Bansak, St. Lawrence University and Allan A. Zebedee, Clarkson University

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