Determinants in the Development of Financial Centers: Evolution Around the World

Abstract

The development of financial markets as well as a country’s overall financial system plays a crucial role in the evolution of the world’s real economy. In developed countries like the USA, UK, Japan, and European nations, the world’s financial centers are located for exchanging huge capital flows with well-established functioning. However, laying the foundation for a financial center can be a big challenge to developing markets whose financial systems are still in the early stages, since the formation of financial centers is determined by multiple factors. Motivated by that reason, this book chapter provides a comprehensive review of critical determinants in the formation of international financial centers, including (i) economic growth; (ii) governance and business environment; (iii) financial development; (iv) labor force; (v) infrastructure accessibility; and (vi) the country’s reputation and stability. In line with the reviewed literature, the study particularly highlights the recent political and technological developments in the world and their impacts on the future of different financial centers worldwide.

Citation

Phung, G., Truong, H. and Trinh, H.H. (2023), "Determinants in the Development of Financial Centers: Evolution Around the World", Kim, S.-J. (Ed.) Fintech, Pandemic, and the Financial System: Challenges and Opportunities (International Finance Review, Vol. 22), Emerald Publishing Limited, Leeds, pp. 337-362. https://doi.org/10.1108/S1569-376720220000022015