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Securities Transaction Taxes for U.S. Financial Markets
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Securities Transaction Taxes for U.S. Financial Markets

Author

Listed:
  • Robert Pollin

    (Department of Economics and Political Economy Research Institute (PERI), University of Massachusetts, Amherst)

  • Dean Baker

    (Center for Economic and Policy Research (CEPR))

  • Marc Schaberg

Abstract

This paper examines the viability of security transaction excise taxes (STETs) as one policy tool for promoting a more stable financial environment, specifically with respect to the U.S. economy. Contrary to a large recent critical literature, we show that a STET can be designed without creating large distortions between segments of the financial market. We also show that a modest STET for the U.S.—beginning with a 0.5 percent tax on equity trades and scaled appropriately for other financial instruments—would generate substantial new government revenues, on the order of $100 billion per year.

Suggested Citation

  • Robert Pollin & Dean Baker & Marc Schaberg, 2003. "Securities Transaction Taxes for U.S. Financial Markets," Eastern Economic Journal, Eastern Economic Association, vol. 29(4), pages 527-558, Fall.
    • Handle: RePEc:eej:eeconj:v:29:y:2003:i:4:p:527-558
    as

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    References listed on IDEAS

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    More about this item

    Keywords

    Financial Market; Securities;

    JEL classification:

    • F3 - International Economics - - International Finance
    • G13 - Financial Economics - - General Financial Markets - - - Contingent Pricing; Futures Pricing
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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