The Clustering of Financial Services in London*

This paper reports a one-year study which investigated the clustering of financial services activity in London. A questionnaire asking about the advantages and disadvantages of a London location was sent to a stratified sample of 1,500 firms and institutions. In addition, thirty-nine on-site interviews with firms, professional institutions, government bodies and other related agencies were conducted. The study finds that banking, including investment banking, forms the cluster’s hub with most other companies depending on relationships with this sub-sector. Generally, the cluster confers many advantages to its incumbents including enhanced reputation, the ability to tap into large, specialized labor pool and customer proximity. The localized nature of relationships between skilled labor, customers and suppliers is a critical factor which helps firms achieve innovative solutions, develop new markets and attain more efficient ways to deliver services and products. Particularly important are the personal relationships which are enhanced by the on-going face-to-face contact that is possible in a compact geographical space. Many of the cluster’s advantages are dynamic in that they become stronger as agglomeration increases. The study also finds important disadvantages in the cluster which threaten its future growth and prosperity. These include the poor quality and reliability of transport, particularly the state of the London Underground and links to airports, increasing levels of regulation and government policy that is not co-ordinated with the whole of the cluster in mind. Key words: Industrial clustering, agglomeration, financial services.

Global Law Firms: Globalization and Organizational Spaces of Cross-Border Legal Work

The aim of this paper is not, however, to generically chart the rise of the global law firm; others have already done this. Instead, our interest lies in better understanding how existing geographies of globalization of law and lawyers, alongside the new geographies of professional partnership and legal work, have created opportunities and challenges for global law firms. More specifically, we seek to unravel the complexities of: (a) the factors driving the presence and absence of global law firms in different cities; and (b) the way that law firms have been reconfigured to operate as spatially distributed organizations present in cities as far apart as New York and Tokyo and London and Hong Kong. As we show, the decision to be there and the intricacies of operating as a global organization are both issues that have unique peculiarities when examined in relation to law and law firms, something that prevents generalization from existing studies of other professional industries. To date, however, limited attention has been paid to these organizational peculiarities. This paper seeks to fill this research void, something that is significant because the peculiarities of how global law firms operate provide the foundations upon which allow the likes of Clifford Chance to become lubricators of global capitalism through transnational lawyering and lawmaking

How financial products organize spatial networks: Analyzing collateralized debt obligations and collateralized loan obligations as “networked products”

During the 2010s, collateralized loan obligations rapidly became a trillion-dollar industry, mirroring the growth profile and peak value of its cousin—collateralized debt obligations—in the 2000s. Yet, despite similarities in product form and growth trajectory, surprisingly little is known about how these markets evolved spatially and relationally. This paper fills that knowledge gap by asking two questions: how did each network adapt to achieve scale at speed across different jurisdictions; and to what extent does the spatial and relational organization of today's collateralized loan obligation structuration network, mirror that of collateralized debt obligations pre-crisis? To answer those questions, we draw on the global financial networks approach, developing our own concept of the networked product to explore the agentic qualities of collateralized debt obligations and collateralized loan obligations—specifically how their technical and regulatory “needs” shape the roles and jurisdictions enrolled in a global financial network. We use social network analysis to map and analyze the evolving spatial and relational organization that nurtured this growth, drawing on data harvested from offering circulars. We find that collateralized debt obligations spread from the US to Europe through a process of transduplication—that similar role-based network relations were reproduced from one regulatory regime to another. We also find a strong correlation between pre-crisis collateralized debt obligation- and post-crisis collateralized loan obligation-global financial networks in both US$- and €-denominations, with often the same network participants involved in each. We conclude by reflecting on the prosaic way financial markets for ostensibly complex products reproduce and the capacity for network stabilities to produce market instabilities

Comparing London and Frankfurt as world cities: a relational study of contemporary urban change

The report examines changing relations between London and Frankfurt with the introduction of a single European currency and the decision to locate the European Central Bank in Frankfurt. Based on interviews with key personnel in global financial and business service firms and institutions in both cities, the findings support a network model of inter-city relations, which, the authors contend, is more appropriate than the simplistic competition model that dominates public discussion

The Clustering of Financial Services in London

This paper reports a one-year study which investigated the clustering of financial services activity in London. A questionnaire asking about the advantages and disadvantages of a London location was sent to a stratified sample of 1,500 firms and institutions. In addition, thirty-nine on-site interviews with firms, professional institutions, government bodies and other related agencies were conducted. The study finds that banking, including investment banking, forms the cluster’s hub with most other companies depending on relationships with this sub-sector. Generally, the cluster confers many advantages to its incumbents including enhanced reputation, the ability to tap into large, specialized labor pool and customer proximity. The localized nature of relationships between skilled labor, customers and suppliers is a critical factor which helps firms achieve innovative solutions, develop new markets and attain more efficient ways to deliver services and products. Particularly important are the personal relationships which are enhanced by the on-going face-to-face contact that is possible in a compact geographical space. Many of the cluster’s advantages are dynamic in that they become stronger as agglomeration increases. The study also finds important disadvantages in the cluster which threaten its future growth and prosperity. These include the poor quality and reliability of transport, particularly the state of the London Underground and links to airports, increasing levels of regulation and government policy that is not co-ordinated with the whole of the cluster in mind. Key words: Industrial clustering, agglomeration, financial services

Automatic mode tracking for flight dynamic analysis using a spanning algorithm

Identifying and tracking dynamic modes in a multi-dimensional parameter space is a problem that presents itself in many engineering disciplines. In a flight dynamics context, the dynamic modes refer to the modes of motion obtained from a linearisation of the aircraft system about a known operating point. Typically dynamic results derived from these linear models are unsorted, where mode indices are unrelated from one operating point to the next. When varying the parameters, or in this case operating point, difficulties in automating the process of relating modes from a linear system derived at one parameter set to the next exists. This paper builds on the work in tracking modes in a structural context, using the Modal Assurance Criterion (MAC) to numerically relate modes from two comparable linear systems. The (MAC) is deployed within a spanning algorithm to discover and identify all modes within all conditions, with their relationship to adjacent/neighbouring conditions. This is tested on a 1-, 2- and 3-dimensional parameter space, twelve state system

World cities in the Pacific Rim: a new global test of regional coherence

A new evaluation of the Pacific Rim concept is presented. The originality of this test for regional coherence is to be found in the basic units being analysed: cities instead of states. Based on a theoretical framework that identifies world city and world city network formation in terms of the office networks of advanced producer service firms, we use a principal components analysis to analyse a data set of 28 Pacific Rim cities and 46 global service firms. This identifies five main groupings of cities in terms of similar mixes of corporate service firms: a western Rim group; a group of ‘old Commonwealth’ cities; a market communist group of cities; Tokyo as a global city; and US cities as a specific separate group. These results confirm the numerous earlier studies that were sceptical of the existence of a coherent Pacific Rim region. However, the particular approach adopted here allows us to identify the Pacific Rim generically as a particularly pernicious construct. We conclude that the Pacific Rim is a geographical chaotic conception

General insurance marketing: a review and future research agenda

The financial services sector is a huge and diverse industry comprising many different forms of organisations and product offerings. Yet, a review of past papers in the Journal of Financial Services Marketing (JFSM) reveals a heavy bias towards articles on banking, to the neglect of other equally important financial services categories. The purpose of this paper is to address this imbalance and to call for more research to be conducted in a wider range of financial services categories. In particular, general insurance is singled out as a category worthy of further research. Looking to the past, this paper reviews research published to-date on general insurance in the JFSM to establish a benchmark and explore theoretical contributions. Attention is then turned to the future to identify a research agenda for the general insurance sector going forward. 5 important themes are identified: trust, transparency and simplification, technology, HNW and Takaful

Cultural and economic complementarities of spatial agglomeration in the British television broadcasting industry: Some explorations.

This paper considers the processes supporting agglomeration in the British television broadcasting industry. It compares and contrasts the insights offered by the cultural turn in geography and more conventionally economic approaches. It finds that culture and institutions are fundamental to the constitution of production and exchange relationships and also that they solve fundamental economic problems of coordinating resources under conditions of uncertainty and limited information. Processes at a range of spatial scales are important, from highly local to global, and conventional economics casts some light on which firms are most active and successful