1 thought on “The evolution of the financial industry gathering of the financial industry”
Anthony
The evolution of the financial industry’s agglomeration is to explore the gathering of financial industry from a dynamic perspective. The British scholar Dow summarizes the evolution of the banking space that accompanies the changes in its organization. That is, the evolution of the banking space system is divided into six stages. 1. The financial intermediary of the local community; 2. The reputation of the operator brings market expansion but is still limited to the local area; 3. The banking system develops to the country; 4. According to domestic expansion to overseas; Competition; 6. Relax control brings international competition and eventually leads to relevant activities in the financial center. This process can be summarized as the local or regional banking phase, through the decentralized stage and financial activities of national banks and financial activities in special location to form a regional and national financial center stage, to achieve international development and concentration of international financial centers to the international financial center concentration stage. naresh and Gary (2003) believe that the financial service industry cluster is developing dynamically. Based on the cluster life cycle proposed by SWAN (1998), they pointed out that the positive effects of the financial service industry cluster will not continue to exist indefinitely, and it will mature at a certain critical point. At this time The phenomenon of competition will increase, and the entry and growth rate of companies in the cluster will decrease, which will eventually lead to the decline of the cluster. They also analyzed the reasons for the dynamic development of the financial service industry: the gathering of the financial service industry can bring benefits and cost. When the benefits are greater than the cost, the cluster will grow Attract new enterprises to join; when the cost of gathering the financial service industry is greater than the income, the cluster will gradually decline. They use Table 1 to indicate the factors that promote the growth of the financial service industry and lead to decline. Gehrig focuses on the influencing factors of the financial center, pointing out that there is a heart and centrifugal factors affecting the financial center. The heart factor includes: (1) the scale economy, that is, the local economic scale. The scale of already existed, which is very important for the financial industry’s agglomeration. (2) Information overflow effect. The concentration of financial institutions makes effective information easily spread, increasing the communication between financial practitioners, and is conducive to the emergence of new ideas and new ideas. (3) Market liquidity. Investors are often inclined to choose small risks, and in the market with strong liquidity, individual traders have a smaller influence on prices than non -flowing markets. Therefore, the market liquidity is strong, and the corresponding traffic volume is more. Corporation refers to market entry costs, political interference, and local protection. These factors often cause barriers to entering the financial industry. It from the above literature, it can be seen that the evolution of the gathering of financial industry is not only affected by the cost and profit changes in the agglomeration area, but also affected by external factors, such as government policies and financial systems. Therefore, the impact of the dynamic perspective of system dynamics on the gathering of financial industry should be more explained by the complicated economic phenomenon of the financial industry’s agglomeration than a static perspective.
The evolution of the financial industry’s agglomeration is to explore the gathering of financial industry from a dynamic perspective. The British scholar Dow summarizes the evolution of the banking space that accompanies the changes in its organization. That is, the evolution of the banking space system is divided into six stages. 1. The financial intermediary of the local community; 2. The reputation of the operator brings market expansion but is still limited to the local area; 3. The banking system develops to the country; 4. According to domestic expansion to overseas; Competition; 6. Relax control brings international competition and eventually leads to relevant activities in the financial center. This process can be summarized as the local or regional banking phase, through the decentralized stage and financial activities of national banks and financial activities in special location to form a regional and national financial center stage, to achieve international development and concentration of international financial centers to the international financial center concentration stage.
naresh and Gary (2003) believe that the financial service industry cluster is developing dynamically. Based on the cluster life cycle proposed by SWAN (1998), they pointed out that the positive effects of the financial service industry cluster will not continue to exist indefinitely, and it will mature at a certain critical point. At this time The phenomenon of competition will increase, and the entry and growth rate of companies in the cluster will decrease, which will eventually lead to the decline of the cluster. They also analyzed the reasons for the dynamic development of the financial service industry: the gathering of the financial service industry can bring benefits and cost. When the benefits are greater than the cost, the cluster will grow Attract new enterprises to join; when the cost of gathering the financial service industry is greater than the income, the cluster will gradually decline. They use Table 1 to indicate the factors that promote the growth of the financial service industry and lead to decline.
Gehrig focuses on the influencing factors of the financial center, pointing out that there is a heart and centrifugal factors affecting the financial center. The heart factor includes: (1) the scale economy, that is, the local economic scale. The scale of already existed, which is very important for the financial industry’s agglomeration. (2) Information overflow effect. The concentration of financial institutions makes effective information easily spread, increasing the communication between financial practitioners, and is conducive to the emergence of new ideas and new ideas. (3) Market liquidity. Investors are often inclined to choose small risks, and in the market with strong liquidity, individual traders have a smaller influence on prices than non -flowing markets. Therefore, the market liquidity is strong, and the corresponding traffic volume is more. Corporation refers to market entry costs, political interference, and local protection. These factors often cause barriers to entering the financial industry.
It from the above literature, it can be seen that the evolution of the gathering of financial industry is not only affected by the cost and profit changes in the agglomeration area, but also affected by external factors, such as government policies and financial systems. Therefore, the impact of the dynamic perspective of system dynamics on the gathering of financial industry should be more explained by the complicated economic phenomenon of the financial industry’s agglomeration than a static perspective.