Securities Transactions Taxes and Financial Crises

Benoît Carmichael, Jean Armand Gnagne and Kevin Moran

CIRANO Working Papers from CIRANO

Abstract: This paper assesses the impact that a widely-based Securities Transaction Tax (STT) could have on the likelihood of systemic financial crises. We apply the methodology developed by Demirgüç-Kunt and Detragiache (1998) [IMF Staff Papers 45 (1)] to a panel dataset of 34 OECD countries for the sample 1973−2012, using a measure of a country’s average bid-ask spread in financial markets as a proxy for the likely effect of a STT on transactions costs. Our results indicate that the establishment of a STT could sizeably increase the risk of financial crises.

Keywords: Securities Transaction Tax; Tobin Tax; Regulation; Financial crises (search for similar items in EconPapers)
JEL-codes: E13 G15 G17 (search for similar items in EconPapers)
Date: 2015-06-11
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://cirano.qc.ca/files/publications/2015s-23.pdf

Related works:
Working Paper: Securities Transactions Taxes and Financial Crises (2015)
Working Paper: Securities Transactions Taxes and Financial Crises (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:cir:cirwor:2015s-23

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