Thegeography of finance (orfinancial geography) is a branch ofeconomic geography that focuses on issues offinancial globalization and the geographic patterns offinance. It studies the effects of statesovereignty,culture, and different kinds of barriers that affect thespatial distribution of finance, such as uneven development and financial exclusion, as well as the global and local connectivity of financial flows and networks. It also researches the creation of newfinancial centres around the world, both offshore and onshore.^[1]

With the continuing process ofglobalization, some geographic barriers, such as transportation costs of goods and capital, are steadily decreasing.^[2] However, many other kinds ofgeographic distance are still very present and relevant to explaining spatial differences.^[3] In the geography of finance, researchers analyse the effects of this distance on the distribution of thefinancial system across the world. Fields ofresearch includeculture andeducation,^[4]technology,^[5] the effects oftacit knowledge and relational proximity,^[1] andpolitics.^[6] An interesting issue in the latter is the increasing entanglement ofbanks andnations,^[7] which is closely related to the geography of networks.^[8] Furthermore, researchers analyse how and how strongly the current spatial distribution of finance affects the allocation offunds,capital, andcredit across different regions.^[9]

The relevance of economic geography is already quite established in the academic world, and research on the topic is in full progress.^[10] However, the geography of finance is now gaining individual focus, especially as the link between the financial economy and the real economy is losing strength.^[11]This is emphasized by the existence ofeconomic bubbles and the fact that thevalue of financial transactions is often multiple times larger than the real economy.^[12]

TheSeptember 11 attacks that targeted theWorld Trade Centre inNew York City drew new attention to the geography of finance. Even though cities have more often been damaged bynatural disasters orterrorist attacks, this attack was focused on the financial system and proved to have significant effects. The event led to a rethinking of the global geographical organization of the financial services industry and drew academic attention to the importance of such densely organized financial districts.^[13]

The2008 financial crisis also led to interesting developments in the geography of finance. It drew new attention to the field, as the crisis showed that local events could cause afinancial crisis that affected smallbusinesses and localgovernments around the world.^[14] The relocation of financial services that had already been occurring was amplified by this crisis, decreasing the importance of major financial centers likeWall Street in lieu of relatively new financial centers elsewhere around the world.^[15]

• International Finance
• International Trade
• Location Theory

• Economic geography

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