Finance fragmented? New SPERI research on EU financial centres post-Brexit published

When the UK leaves the European Single Market, financial firms domiciled in the City of London will lose their ‘passporting rights’. Ahead of the UK’s departure many UK-based banks and other financial institutions are considering whether to relocate parts of their operations to alternative financial centres inside the EU. Frankfurt and Paris are two of the main ‘rivals’ to the City of London.

New research by Dr Scott Lavery (Research Fellow, SPERI and Lecturer in Politics), Dr Davide Schmid (University of Groningen) and Mr Sean McDaniel (University of Warwick) has analysed the strategic positioning of actors within Paris and Frankfurt to understand how they have responded to the Brexit vote.

Their new article ‘Finance fragmented? Frankfurt and Paris as European financial centres after Brexit‘ has been published in the Journal of European Public Policy. An abstract for the article can be found below. The new research features in a new article by Eric Albert in Le Monde.

A SPERI Global Political Economy Brief that explored how actors within Frankfurt have responded since the UK referendum was published in January 2018.

Finance fragmented? Frankfurt and Paris as European financial centres after Brexit – abstract

Brexit creates an opportunity for alternative European financial centres. However, no comprehensive empirical analysis of the strategic positioning of actors within these financial centres has been conducted. In this article we outline findings from an extensive research project which we conducted in Frankfurt and Paris, two of the main ‘rivals’ to the City of London, in the aftermath of Brexit. We outline the core findings from this project and argue that the emerging competition between Frankfurt and Paris is shaped through four related axes: diversity, path dependency, territory and regulatory stability. Our analysis has implications for two bodies of literature within EU studies. First, inter-governmentalist and supra-nationalist approaches would benefit from interrogating more closely the contested sub-national politics of financial centres. Second, our analysis adds to a growing body of literature on European disintegration by interrogating the interaction of fragmentary and integrative dynamics in the sphere of European finance.