TY  - GEN
ID  - heidok16804
KW  - Transaction Tax
KW  -  Financial Regulation
KW  -  Heterogeneous Beliefs
N2  - This papers studies the impact of a ?nancial transactions tax on the trading volume and asset price volatility in a model with heterogeneous beliefs. To model heterogeneous beliefs we follow Kurz (1994, 1997) and restrict the class of beliefs to the subset of rational beliefs. We study a tax on bond and asset purchases. The simulated model shows that the introduction of a transaction tax results in a lower trading volume and therefore in less liquid ?nancial markets. Because of the decreased liquidity the volatility of the stock market increases. We also study the welfare effects of a ?nancial transaction tax and the simulation results also show that there is only a small change in welfare.
EP  - 41
TI  - Financial Transaction Tax and Financial Market Stability with Diverse Beliefs
Y1  - 2014/04//
UR  - https://archiv.ub.uni-heidelberg.de/volltextserver/16804/
AV  - public
T3  - Discussion Paper Series / University of Heidelberg, Department of Economics
A1  - Rieger, Jörg
ER  -