Market microstructure matters when imposing a Tobin tax—Evidence from the lab

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Market microstructure matters when imposing a Tobin tax—Evidence from the lab☆

TRADING IN FX MARKETS IS DOMINATED BY TWO MICROSTRUCTURES: exchanges with market makers and OTC-markets without market makers. Using laboratory experiments we test whether the impact of a Tobin tax is different in these two market microstructures. We find that (i) in markets without market makers an unilaterally imposed Tobin tax (i.e. a tax haven exists) increases volatility. (ii) In contrast,...

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ژورنال

عنوان ژورنال: Journal of Economic Behavior & Organization

سال: 2011

ISSN: 0167-2681

DOI: 10.1016/j.jebo.2011.06.001