ABSTRACT
The growth in equity capital markets in the second half of the 19th century and the first three decades of the 20th century was more than dramatic (e.g., Cassis 2006, 2012; Preda 2005). By the end of the 19th century, there were globally important stock exchanges in the ‘capitals of capital’: London, New York, Paris and, to a lesser extent, Berlin. These centers were bolstered by networks of provincial exchanges and trade on lesser exchanges in Amsterdam, Zurich, Brussels, Frankfurt and other centers. In the period up to World War I, London held a dominant position as the global financial centre (Cassis 2012, p.17):
The years between 1870 and 1914 were the classical period of London as the world’s financial centre-not only in quantitative terms, but also in qualitative terms. The City was the first modern financial centre where an unrivaled range of services were provided. . . . London was the main centre for the issue of foreign loans, with Britain accounting for some 40 per cent of the stock of foreign investment in 1913. The London Stock Exchange was larger than the Paris Bourse and the New York Stock Exchange combined, and one third of all the world’s negotiable instruments were quoted there. The City hosted major commodity markets, such as the London Metal Exchange and the Baltic Exchange; it was the world’s leading insurance market, in particular with Lloyd’s of London.
