Dear colleague:
Delighted to hear that you see Tobin's proposal as neccesary. It is
not as impractical as you fear, though, if one looks closely at all
counterarguments. I do not know whether you know the excellent
book edited by M. ul Haq, I. Kaul and I. Grunberg Oxford UP 1996),
which seesm to answer such questions quite clearly.
However, I have also written a small paper "The Tobin-Tax: Reviving
a Discussion" (World Development, vol.26, no.3, March 1998,
pp.529-538), which is shorter..
To come to your main point: true, speculators can go to ever more
complex constructions - but there is a cost involved in that: they
get less liquid. A rational speculator should - and, I think, would -
simply calculate costs (incl. costs that may occur by the loss of
liquidity) and gains. Thus the TT will not be able to have negative
effects on all transactions, but on quite a few.
With best regards
Kunibert Raffer
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Department of Economics, University of Vienna
Hohenstaufengasse 9, A-1010 Vienna, Austria
Phone:+43 1 4277 374 ext. 18 (direct) or 01 or 05
Fax: +43 1 4277 9374
http://mailbox.univie.ac.at/~rafferk5/
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