Bibliography

Here is a selection of technical work already done around Financial Transaction Taxes and financial markets. It is not an exhaustive reference list but we have chosen some of the more recent papers that are accessible and readable, or which deal with some of the questions that keep coming up in the discussion.  Also included is the original idea from James Tobin that started the discussion off more than 30 years ago!

Baker, D., et al., 2009. The Potential Revenue from Financial Transactions Taxes. Center for Economic and Policy Research: Washington D.C., USA.
http://www.cepr.net/documents/publications/ftt-revenue-2009-12.pdf

Bernd Spahn, P., 2002. On the Feasibility of a Tax on Foreign Exchange Transactions. Report commissioned by the Federal Ministry for Economic Cooperation and Development: Bonn
http://www.wiwi.uni-frankfurt.de/profs/spahn/tobintax/Chapter0.pdf

BIS, 2007. Triennial central bank survey of foreign exchange and derivatives market activity in April 2007. Statistical report, Bank for International Settlements: Basle.
http://www.bis.org/publ/rpfxf07t.htm

Dietz, M., et al., 2008. What’s in store for global banking. McKinsey Quarterly: January 2008
https://solutions.mckinsey.com/globalbankingpools/cms/_SiteNote/WWW/GetFile.aspx?uri=:/globalbankingpools/cms/gpp-content/en-us/article/Files/MainBloc/ProfitPoolsFinal_08fe84d7-d06a-4630-ad50-f737945ec1dc.pdf

Ehrenstein, G., F. Westerhoff, et al. (2005). “Tobin tax and market depth.” Quantitative Finance 5: 213–218
http://www.informaworld.com/smpp/content~content=a724004927&db=all

Grunberg, Isabelle, Inge Kaul and Mahbub ul Haq, (1996) The Tobin Tax: Coping with Financial Volatility. New York: Oxford University Press

Murphy, R., 2010. Taxing Banks. A joint submission to the International Monetary Fund: London, UK
http://www.taxresearch.org.uk/Documents/IMFTaxingBanks.pdf

Pollin, R., D. Baker & M. Schaberg, 2003. Securities Transaction Taxes for U.S. Financial Markets. Eastern Economic Journal 29/4: pp.527-58.
http://college.holycross.edu/eej/Volume29/V29N4P527_558.pdf

Schmidt, R., 2008. The Currency Transaction Tax: Rate and Revenue Estimates. United Nations University Press: Tokyo, New York, London.
http://www.stampoutpoverty.org/?lid=10738

Schulmeister, S., et al., 2008. A General Financial Transaction Tax: Motives, Revenues, Feasibility and Effects. Austrian Institute of Economic Research: Austria.
http://www.wifo.ac.at/wwa/servlet/wwa.upload.DownloadServlet/bdoc/S_2008_FINANCIAL_TRANSACTION_TAX_31819$.PDF

Spratt, S., 2006. A Euro Solution: Implementing a stamp duty on Euro to finance international development. Stamp Out Poverty: London, UK
http://www.stampoutpoverty.org/?lid=10558

Spratt, S., 2006. A Sterling Solution: Implementing a stamp duty on Sterling to finance international development. Stamp Out Poverty: London, UK
http://www.stampoutpoverty.org/?lid=9889

Stiglitz, J., 1989. Using tax policy to curb speculative short-term trading, Journal of Financial Services Research: Vol. 3, pp.101-15
http://www.springerlink.com/content/n2804801534g5022/

Suescún, R., 2004. Raising Revenue with Transaction Taxes in Latin America – or is it better to tax the devil you know? World Bank Policy Research Working Paper 3279
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=610324

Summer, L.H. and Summers, V.P., 1989. When financial markets work too well: A cautious case for a securities transactions tax. J. Financial Serv. Res.: Vol3, pp. 261-286

http://www.springerlink.com/content/p016371m624r6742/

Tobin, James, 1978, A Proposal for International Monetary Reform, Yale University, Cowles Foundation Discussion Papers, No.506
http://ideas.repec.org/p/cwl/cwldpp/506.html

Zee, Howell, (2000) “Retarding Short-Term Capital Inflows Through Withholding Tax,” IMF Working Paper, no. 00/40,
http://www.imf.org/external/pubs/ft/wp/2000/wp0040.pdf

  • Miroslav
    Schmidt (2008) is the only one worth reading. He recommends carbon tax though. And thinks to get away with taxing currencies alone (with ETFs and derivatives, i.e. perfect substitutes remaining untaxed). Pollin (2003) actually claims that 0.61% transaction costs are "small" in a 2003 paper! Worthy of Eastern Economic Journal... and notice that only 2-3 of all those PDFs have been accepted for publication, i.e. are peer-reviewed... the rest of this propaganda is self-published, posted to owners websites, could be removed from Wikipedia any time.

    The evidence against FTT is so overwhelming that even Schulmeister et al had to admit it...
  • DJC
    The main arguement against a FTT is that trade will reduce or cease, all of the research accounts for some reduction in turnover as this is the accepted theory (it is a theory as there has never been a broad FTT). However small scale trading taxes are currently in place, India has recently introduced one on its stock market and turnover actually increased not decreased, and the Chinese stock exchange has had a tax for more than a decade and there isn't evidence of a direct correlation between increases and decreases in financial costs and changes in turnover.

    Turnover seems to be affected by factors other than costs, including the confidence of the trader, the global market, volatility etc.
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