Cities and the Geography of Financial Centres
This paper surveys the literature on the geography of financial activity in order to assess the role of financial centres. While there is widespread concern that rapid technological progess especially in communication and information technologies will ultimately lead to a delocalization of financial activity, the role of financial centres depends delicately on their success in generating local externalities. On the basis of empirical evidence on recent developments in world financial markets, it is argued that the ability of financial centres to attract financial activity in information sensitive securities will be crucial for their future role. To the extent that information is localized and market access is costly, financial centres perform an important role in aggregating local information. Therefore a reduction of global market access and information costs may increase global demand for local securities, and even strengthen the role of certain financial centres. Furthermore, complementarities between informationally sensitive and less sensitive financial activities may also attract footloose activities to financial centres.
|Date of creation:||Jun 1998|
|Date of revision:|
|Contact details of provider:|| Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ.|
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
|Order Information:|| Email: |
When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:1894. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.