The correlates of international financial-center status

Abstract

We consider the correlates of international financial-center status. Our estimates point to the flexibility, transparency, and stability of the economic and social environment as determinants of financial center-status. They point also to roles for monetary and financial stability, financial openness, financial scale and development, technology and size of government. We draw out the implications of this analysis for the future prospects of actual and aspiring international financial centers such as London, New York, and Shanghai.