world financial center survey: London, New York, Hong Kong tied at the top


A London-based consulting group called Z/Yen (the name is supposed to mean risk/reward) has been compiling rankings of the world’s financial centers semiannually for the past four years. The first seven lists were underwritten by the City of London, the latest by the Financial Center Authority of Qatar.

The results

The September 2010 shows a virtual dead heat for first place among global financial centers among:


–New York, and

–Hong Kong.

The remainder of the top ten, in descending order, are:








The bottom of the pile of 75 cities rated are, again in descending order:





Although the survey has been going on for only a short period of time, a number pf patterns have begun to emerge:

the steady rise of Asian centers.

— Z/Yen predicts that Singapore will soon emerge as a world co-leader with the present top three.

–Hong Kong and Shanghai have shown the most improvement from list to list

–survey participants name Shenzhen, Shanghai and Singapore as their picks for the cities with the most upward potential

tax havens losing favor

–The Cayman Islands and the Bahamas are among the havens showing the greatest falls in ranking, all all tax-favored centers are declining. Oddly, Scandinavia is the other area on the wane.


The ranking is obtained by combining the results of an internet survey of financial professionals with an analysis of “instrumental factors” selected to describe the objective working conditions in a given city.

For this list, Z/Yen obtained input from 1,876 survey participants, who made a total of 33,023 city rankings.

The instrumental factors fall into five groups: people, business environment, infrastructure, market access and general competitiveness. Specific factors include things like office rents, personal and corporate income tax rates, and indices of corruption and regulatory opacity.


All of the top names on the list—down almost to the middle, in fact—exhibit a reputational glow. That is to say, the ratings derived from the online survey questionnaire are significantly higher than those obtained from statistical analysis of the instrumental factors alone, although the rank order remains the same. My guess is this is because the survey participants rank on average just shy of twenty cities. How can they know that many?

The perennial question about internet surveys (see my posts on surveying) is that there’s no way of telling whether the respondents to the survey are characteristic of the overall group whose opinion you want to obtain. Relative to the survey results that, say, the Census Bureau, get, online surveys have to be regarded as not 100% reliable.

On particular items in the survey, one section looks at the regional breakdown of favorable and unfavorable ratings. Everyone agrees that London and New York are the top two financial centers. Europeans, however, are very skeptical of Asian financial cities. The US joins Europe in worries about Shanghai. No one likes the tax havens other than the havens themselves.

my thoughts

My guess is that the list is fairly reliable.

The rise of Hong Hong doesn’t surprise me too much, since that entrepreneurial city has constantly reinvented itself over the years. It still has an advantage over the mainland in support services for financial professionals.

I find the emergence of Singapore interesting, although that city-state has been undergoing a thorough makeover during the past decade.

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