Technology has facilitated both greater cross-border participation in financial markets and a growing prevalence of cross-jurisdictional financial market infrastructure providers. This paper investigates the potential impact of these trends on the location of various financial markets on the financing of Australian businesses. In both the foreign exchange and derivative markets the benefits of centralised markets would appear to clearly outweigh any costs. However, in the capital markets the outcome of this trade-off is less clear.

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This paper was presented in July 2014 at the 19th Melbourne Money and Finance Conference (MMFC), which explored the theme Current Issues in Australian Financial Markets.

For more papers presented in the conference, please click here