The Effect of the Securities Transaction Tax Rate Cut on the Liquidity in KRX

Author:

Lee Woo Baik

Abstract

This study evaluated the impact of the securities transaction tax rate cut implemented in 2019 on the liquidity of the stock market. The empirical results are summarized as follows. First, cutting the transaction tax rate affects trading volume rather than spread or price. Additionally, this liquidity improvement more strongly affects low liquid stocks in the period before the transaction tax rate cut. Second, in low liquid stocks that showed effects in trading volume, individuals and foreigners took the leadership in overall trading. Third, liquidity improvement persisted not only in the short term immediately after the transaction tax rate cut, but also until the second half of the sample period. These empirical results show the differing effect of the transaction tax on improving liquidity by liquidity level and a limited effect in low-liquidity stocks. As investors trading low-liquidity stocks with high tax elasticity were sensitive to the burden of transaction costs, the effect of transaction tax cuts was strong, while such effects could not be found in stocks with high liquidity. These empirical results provide practical implications for the level of transaction costs and the method of setting as a means to revitalize market liquidity.

Funder

Seoul National University

Publisher

Korean Securities Association

Subject

General Medicine

Cited by 1 articles. 订阅此论文施引文献 订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献

同舟云学术

1.学者识别学者识别

2.学术分析学术分析

3.人才评估人才评估

"同舟云学术"是以全球学者为主线,采集、加工和组织学术论文而形成的新型学术文献查询和分析系统,可以对全球学者进行文献检索和人才价值评估。用户可以通过关注某些学科领域的顶尖人物而持续追踪该领域的学科进展和研究前沿。经过近期的数据扩容,当前同舟云学术共收录了国内外主流学术期刊6万余种,收集的期刊论文及会议论文总量共计约1.5亿篇,并以每天添加12000余篇中外论文的速度递增。我们也可以为用户提供个性化、定制化的学者数据。欢迎来电咨询!咨询电话:010-8811{复制后删除}0370

www.globalauthorid.com

TOP

Copyright © 2019-2024 北京同舟云网络信息技术有限公司
京公网安备11010802033243号  京ICP备18003416号-3