Related papers: Pathways towards instability in financial networks
This paper proves an instability theorem for dynamical systems. As one adds interactions between subystems in a complex system, structured or random, a threshold of connectivity is reached beyond which the overall dynamics inevitably goes…
Understanding how information flows through the financial networks is important, especially during times of market turbulence. Unlike traditional assumptions where information travels along the shortest paths, real-world diffusion processes…
Empirical studies of graphs have contributed enormously to our understanding of complex systems. Known today as network science, what was originally a theoretical study of graphs has grown into a more scientific exploration of communities…
Turing patterns, arising from the interplay between competing species of diffusive particles, has long been an important concept for describing non-equilibrium self-organization in nature, and has been extensively investigated in many…
We consider a dynamical model of distress propagation on complex networks, which we apply to the study of financial contagion in networks of banks connected to each other by direct exposures. The model that we consider is an extension of…
Processes on networks consist of two interdependent parts: the network topology, consisting of the links between nodes, and the dynamics, specified by some governing equations. This work considers the prediction of the future dynamics on an…
The observed architecture of ecological and socio-economic networks differs significantly from that of random networks. From a network science standpoint, non-random structural patterns observed in real networks call for an explanation of…
Biological networks of interacting agents exhibit similar topological properties for a wide range of scales, from cellular to ecological levels, suggesting the existence of a common evolutionary origin. A general evolutionary mechanism…
The topology of production networks determines the propagation mechanisms of local shocks and thus the co-movement of industries. As a result, we need a more precisely defined production network to model economic growth accurately. In this…
Unstoppable feedback loops and tipping points in socio-ecological systems are the main threats to sustainability. These behaviors have been extensively studied, notably to predict, and arguably deviate, dead-end trajectories. Behind the…
Management of systemic risk in financial markets is traditionally associated with setting (higher) capital requirements for market participants. There are indications that while equity ratios have been increased massively since the…
Cascading failures, such as bankruptcies and defaults, pose a serious threat for the resilience of the global financial system. Indeed, because of the complex investment and cross-holding relations within the system, failures can occur as a…
In this paper, we assess how the stability of financial networks is affected by interconnectedness considering its tiniest variation: the edge. We compute the impact of edges as the percentage difference in the systemic risk (SR) of the…
Turing patterns formed by activator-inhibitor systems on networks are considered. The linear stability analysis shows that the Turing instability generally occurs when the inhibitor diffuses sufficiently faster than the activator. Numerical…
The influence of networks topology on collective properties of dynamical systems defined upon it is studied in the thermodynamic limit. A network model construction scheme is proposed where the number of links, the average eccentricity and…
Trade networks, across which countries distribute their products, are crucial components of the globalized world economy. Their structure is strongly heterogeneous across products, given the different features of the countries which buy and…
We study the emergence of instabilities in a stylized model of a financial market, when different market actors calculate prices according to different (local) market measures. We derive typical properties for ensembles of large random…
Turing instability in activator-inhibitor systems provides a paradigm of nonequilibrium pattern formation; it has been extensively investigated for biological and chemical processes. Turing pattern formation should furthermore be possible…
With the network methods and random matrix theory, we investigate the interaction structure of communities in financial markets. In particular, based on the random matrix decomposition, we clarify that the local interactions between the…
Network theory is rapidly changing our understanding of complex systems, but the relevance of topological features for the dynamic behavior of metabolic networks, food webs, production systems, information networks, or cascade failures of…