Securities Transactions Taxes and Financial Crises

Benoît Carmichael, Jean Armand Gnagne and Kevin Moran

Cahiers de recherche from Centre de recherche sur les risques, les enjeux économiques, et les politiques publiques

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: E130; G150; G170 (search for similar items in EconPapers)
JEL-codes: E13 G15 G17 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (1)

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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:lvl:crrecr:1506

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