In the wake of the financial crisis, a number of countries have introduced levies on bank borrowing with the aim of reducing risk in the financial sector. This paper studies the behavioral responses to the bank levies and evaluates the policy. We find that the levies induced banks to borrow less...

In the wake of the ?nancial crisis, a number of countries have introduced levies on bank borrowing with the aim of reducing risk in the ?nancial sector. This paper studies the behavioral responses to the bank levies and evaluates the policy. We ?nd that the levies induced banks to borrow less...