ABSTRACT
This chapter examines the factors that make for a successful financial center. It provides a more general discussion of financial center competition. The chapter discusses how changes in financial services institutions and activities have redefined the nature and location of financial centers. It considers how organizational changes in financial institutions have affected location decisions by firms, which in turn affect financial centers. The chapter highlights several key areas, or "dimensions of competitiveness," that can be addressed by public policy in order to develop and retain a concentration of financial activity in an area. The wave of changes in financial services has influenced the nature and location of financial centers around the world. The concentration of financial institutions and markets in financial centers also attracts nonfinancial firms. Developments in telecommunications and computer technology, convergence, and globalization are changing the nature of financial centers. Financial markets and the organizational structure of financial services institutions have grown and changed in tandem.
