Abstract
This Article endeavors to broaden the analysis of available policy tools to address the problems created by financial crises and discusses how, in addition to direct regulation, certain tax measures having a regulatory nature may operate to address the so-called “negative externalities” often associated with those crises. There is a negative externality when an economic agent making a decision does not pay the full cost of the decision’s consequences. In such cases, the cost to society as a whole is greater than the cost borne by the individuals creating the economic impact. In practice, negative externalities result in market inefficiencies or failures since in most cases individuals do not fully take into account the costs of the negative externalities created.
Recommended Citation
Carlo Garbarino & Giulio Allevato,
The Global Architecture of Financial Regulatory Taxes,
36
Mich. J. Int'l L.
603
(2015).
Available at:
https://repository.law.umich.edu/mjil/vol36/iss4/2