195,350 research outputs found
"Why the Tobin Tax Can Be Stabilizing"
No full textThis paper clarifies why a transaction tax of the type proposed by James Tobin can have a stabilizing influence in financial markets. It argues that such a tax is potentially stabilizing, not because it reduces the "excessive" volume of transactions, but because it can slow the speed with which market traders react to price changes. To the extent that a Tobin tax causes financial market traders to delay their decisions a few "grains of sand in the wheels of international finance" can indeed be stabilizing. Whether that is sufficient, or whether boulders-not just grains-are needed to prevent speculative attacks on currencies, is, however, a different matter.
The Tobin Tax A Review of the Evidence
No full textThe debate about the Tobin Tax, and other financial transaction taxes (FTT), gives rise to strong views both for and against. Unfortunately, little of this debate is based on the now considerable body of evidence about the impact of such taxes. This review attempts to synthesise what we know from the available theoretical and empirical literature about the impact of FTTs on volatility in financial markets. We also review the literature on how a Tobin Tax might be implemented, the amount of revenue that it might realistically produce, and the likely incidence of the tax. We conclude that, contrary to what is often assumed, a Tobin Tax is feasible and, if appropriately designed, could make a significant contribution to revenue without causing major distortions. However, it would be unlikely to reduce market volatility and could even increase it.Tobin tax, financial transaction taxes, volatility, revenue, incidence, feasibility
The Keynesian Root of the Tobin tax
No full textThis paper is an attempt to evaluate the strength of the link between the Tobin tax and the so-called Keynes tax, i.e. a tax on security transactions suggested by Keynes in Chapter 12 of the General Theory. Starting from a literal comparison of the two projects, this work analyses the possibility of a common methodological background. It supports the idea that the two measures share similar fundamental targets, despite displaying technical diversity.Tobin tax, Keynes tax, security transaction taxes
Remembering James Tobin: Stories Mostly from His Students
No full textJames Tobin was renowned as an economist of great distinction. Moreover, his students and colleagues witnessed dimensions of his personality and behavior often unknown to others. Up close, Tobin was a memorable figure who made lasting impressions on those he taught and influenced. This article describes Tobin close up, in the words of his students who became professional economists. Rather than focusing on his research, these stories instead present Tobin the teacher, both inside and out of the classroom, Tobin the person, and Tobin the friend and mentor, painting a picture of a remarkable personality. 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.
Cosmopolitan ethics in global finance? : a pragmatic approach to the Tobin Tax
No full textThe thesis provides a critical analysis of the problems and possibilities for
developing cosmopolitan ethics in global finance. With reference to Ideas and
debates within the campaign for a Tobin Tax, it is argued that cosmopolitanism is
a promising, but limited, agenda for global reform. Extending principles of
justice to support the re-distribution of wealth from financial markets towards an
expanded program of global welfare provision is laudable. Likewise, the
possibility of improving accountability mechanisms and fostering democratic
inclusion in the global financial system should be supported. However, the thesis
identifies and reflects upon some important ethical ambiguities relating to
financial, institutional and democratic universalism. A requirement for capital
account convertibility, a cash-based approach to global justice and proposals for
state-centric world authority to administer the Tobin Tax infers that the proposal
would entrench many of the logics its supporters might oppose. The thesis
develops a pragmatic approach to these questions based on the philosophical
pragmatism of Richard Rorty. A pragmatic approach acknowledges the historical
and cultural contingency of cosmopolitanism, but questions how the ambiguities
and tensions that pervade global ethics can be engaged. In this sense, and
developing Rorty's concept of sentimental education, it is argued that the Tobin
Tax campaign has generated a broad-based public conversation about global
finance, increasing sensitivity to the suffering caused by global finance and the
ways in which it might be changed. While such conversation may not solve all
the dilemmas identified, it does allow for increased awareness of the ambiguity
of ethics. The thesis points to a number of instances in the campaign where the
constitutive ambiguities of the Tobin Tax have been questioned and alternative
practices suggested. A pragmatic approach to the Tobin Tax campaign therefore
situates cosmopolitan ideas in the extant dilemmas and indeterminacies of global
ethics, looking to suggest alternatives where possible
James Tobin : an appreciation of his contribution to economics.
No full textJim Tobin, who died on March 11, 2002 at the age of 84, was one of giants of economics of the second half of the twentieth century and the greatest macroeconomist of his generation. Tobin’s influence on macroeconomic theory is so pervasive - so much part of our professional ‘acquis’ - that many younger economists often are not even aware that it is his ideas they are elaborating, testing, criticising, refuting or re-inventing. In this Appreciation, I consider Tobin’s scholarly contributions, made over a period of more than 50 years. Tobin received the 1981 Nobel Memorial Prize “for his analysis of financial markets and their relations to expenditure decisions, employment, production and prices”. I consider his contributions to mean-variance portfolio demand and asset pricing theory, especially the Portfolio Separation Theorem; pitfalls in financial model building; portfolio balance and flow of funds models and the ‘credit channel’; the life-cycle model and social security; econometric methodology, including the Tobit estimator and his pioneering work using both time series and cross-sectional data to estimate food demand functions; economic growth; Tobin’s q; the ‘Tobin Tax’ ; the monetary and fiscal policy effectiveness debate, first with Milton Friedman and then with the New Classical Macroeconomics and Real Business Cycle schools; and Tobin’s approach to methodological questions including microfoundations and aggregation.
Stabilizing the International Financial System and Financing Development: An Analysis of the Tobin Tax
No full textThis paper analyzes the feasibility of an international tax on currency transaction, also known as “Tobin Tax”, from an economic and juridical point of view. The claim that such a tax would curb short term speculators, thus stabilizing the foreign exchange market, is discussed. Moreover, the potential revenues of such a tax are evaluated, along with some possible needs these revenues could address: financing developing and the attainment of the Millennium Development Goals, and global public goods. Part one focuses on the thirty-year-old academic debate sparked by James Tobin's proposal; part two describes the features of an hypothetical Currency Transaction Tax (CTT), while part three analyzes how a CTT could be implemented both within the European Union framework, or more generally through an ad hoc international organization.
James Tobin: An Appreciation of his Contribution to Economics
No full textJim Tobin, who died on March 11, 2002 at the age of 84, was one of giants of economics of the second half of the twentieth century and the greatest macroeconomist of his generation. Tobin's influence on macroeconomic theory is so pervasive - so much part of our professional 'acquis' - that many younger economists often are not even aware that it is his ideas they are elaborating, testing, criticising, refuting or re-inventing. In this Appreciation, I consider Tobin's scholarly contributions, made over a period of more than 50 years. Tobin received the 1981 Nobel Memorial Prize for his analysis of financial markets and their relations to expenditure decisions, employment, production and prices'. I consider his contributions to mean-variance portfolio demand and asset pricing theory, especially the Portfolio Separation Theorem; pitfalls in financial model building; portfolio balance and flow of funds models and the 'credit channel'; the life-cycle model and social security; econometric methodology, including the Tobit estimator and his pioneering work using both time series and cross-sectional data to estimate food demand functions; economic growth; Tobin's the 'Tobin Tax'; the monetary and fiscal policy effectiveness debate, first with Milton Friedman and then with the New Classical Macroeconomics and Real Business Cycle schools; and Tobin's approach to methodological questions including microfoundations and aggregation
On Limiting the Domain of Inequality: The Legacy of James Tobin
No full textThe Keynesian macroeconomist James Tobin presented an ambitious program for social policy, sketched in the titles of "It Can be Done! Conquering Poverty in the US by 1976" (1967), "On Limiting the Domain of Inequality" (1970), "On Improving the Economic Status of the Negro" (1965), and "Raising the Incomes of the Poor" (1968). Tobin advocated means-tested cash transfers (negative income tax), to reduce poverty without interfering with market determination of relative prices (a position shared with Milton Friedman), paired with "non-market egalitarian distributions of commodities essential to life and citizenship" (education, food stamps, basic housing). The latter position contrasted with Friedman's Chicago school approach. Tobin's message continues to be relevant for reduction of poverty and inequality. Tobin's approach is contrasted with the neo-conservative analysis of the causes of poverty (exemplified by Herrnstein and Murray, but going back to Senior and Chadwick's Poor Law Report of 1834) that has been reflected in "the end of welfare as we know it".Inequality
The Tobin Tax: another lost opportunity?
No full textThe United Nations Development Programme (UNDP) has promoted the so-called 'Tobin Tax' as a major mechanism for generating a substantial increase in global resources for tackling human-development priorities. Such a levy, on largely speculative and unproductive international transactions, may be capable of generating over US$300 billion per year: several times higher than existing levels of bilateral aid. However, given the muted dialogue at the 1995 World Summit for Social Development, and in order to secure the necessary support of leading developed countries and global financial institutions, it may be inevitable that the Tobin Tax, if adopted, would ultimately serve the interests of the wealthier economies. There is, therefore, an urgent need for the development sector to engage in debate about how, and how much of, such funds would be directed to priority human-development purposes.This article is hosted by our co-publisher Taylor & Francis.</p
- …
