CRIEFF Discussion Paper Number 0805
Financial
centres in peripheral regions: the effect of the
financial services industry on regional economy - the case of the Scottish
Financial cluster
Mikel Larreina (Universidad
Comercial de Deusto)
Abstract
In recent times the financial services industry has
experienced a major transformation, in which markets and players have been globalised and consolidated. Certain financial centres have concentrated on financial firms and markets,
engendering considerable research on the foundations of their pre-eminence.
Nevertheless, the growth of financial centres in
peripheral regions has not been conveniently analysed,
despite the fact that financial activity may play a major role in some
economies.
This paper provides a thorough survey of state-of-the-art
literature, both on the transformation of the financial marketplace, and on the
rise of global financial centres, devoting especial
attention to the appearance of peripheral financial centres.
The Scottish case is studied, among other aspects, through the use of
Input-Output multipliers, to determine the dramatic role financial services
have to play in this region’s economy. This approach advanced may be adapted to
other locations, to help to assess the specific impact of financial centres and to draw attention to possible problems arising
from overdependence on their activity.
JEL codes: R11, R15, G29
Keywords:
High Financial centres, Scotland, financial cluster,
Input-Output, regional economy.
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