Chapter

Financial Crises

Aaron James

in Fairness in Practice

Published in print May 2012 | ISBN: 9780199846153
Published online May 2012 | e-ISBN: 9780199933389 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199846153.003.0008

Series: Oxford Political Philosophy

Financial Crises

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This chapter argues for aggressive securities taxation to curb short-term, speculative capital flows that partly cause financial crises. Much as with any potentially beneficial but highly dangerous activity, short-term speculative markets fairly impose heightened risks of financial crises only if they can be embedded within institutions that reliably compensate for the harm that crises do. Because reliable compensatory institutions are not established and in any case are arguably beyond the regulatory powers of governments, the dangerous activity must in fairness be curbed, even at great economic opportunity costs.

Keywords: Tobin tax; capital controls; harm; compensation; risk imposition; risk assumption; reciprocity of risk

Chapter.  13073 words. 

Subjects: Social and Political Philosophy

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