Related papers: Risk Propagation in Endogenous Supply Chains
Supply chain optimization schemes have more often than not underplayed the role of inherent stochastic fluctuations in the associated variables. The present article focuses on the associated reengagement and correlated renormalization of…
We consider the problem of risk diversification in complex networks. Nodes represent e.g. financial actors, whereas weighted links represent e.g. financial obligations (credits/debts). Each node has a risk to fail because of losses…
We study the correlation structure of firm growth rates. We show that most firms are correlated because of their exposure to a common factor but that firms linked through the supply chain exhibit a stronger correlation on average than firms…
Why do capitalist economies recurrently generate crises whose severity is disproportionate to the size of the triggering shock? This paper proposes a structural answer grounded in the evolutionary geometry of production networks. As…
This paper studies how a downstream retailer in a decentralized two-tier supply chain can implicitly transmit demand information to an upstream supplier through the structure of its order stream in the absence of an explicit…
The 2008 financial crisis illustrated the need for a thorough, functional understanding of systemic risk in strongly interconnected financial structures. Dynamic processes on complex networks being intrinsically difficult, most recent…
Various social, financial, biological and technological systems can be modeled by interdependent networks. It has been assumed that in order to remain functional, nodes in one network must receive the support from nodes belonging to…
Professional networks are a key determinant of individuals' labor market outcomes. They may also play a role in either exacerbating or ameliorating inequality of opportunity across demographic groups. In a theoretical model of professional…
When multiple innovations compete for adoption, historical chance leading to early advantage can generate lock-in effects that allow suboptimal innovations to succeed at the expense of superior alternatives. Research on the diffusion of…
How does social network structure amplify or stifle behavior diffusion? Existing theory suggests that when social reinforcement makes the adoption of behavior more likely, it should spread more -- both farther and faster -- on clustered…
This paper presents evidence on the granular nature of firms' network of foreign suppliers and studies its implications for the impact of supplier shocks on domestic firms' performance. To demonstrate this, I use customs level information…
We contribute to the understanding of how systemic risk arises in a network of credit-interlinked agents. Motivated by empirical studies we formulate a network model which, despite its simplicity, depicts the nature of interbank markets…
Realistic credit risk assessment, the estimation of losses from counterparty's failure, is central for the financial stability. Credit risk models focus on the financial conditions of borrowers and only marginally consider other risks from…
Modern society heavily relies on strongly connected, socio-technical systems. As a result, distinct risks threatening the operation of individual systems can no longer be treated in isolation. Consequently, risk experts are actively seeking…
Assessing the resilience of the economy requires accounting for its intrinsic multi-layer nature, by assessing for instance how disruptions at the firm level spread through the production network and propagate to the banking sector. Methods…
Increased uncertainty due to high penetration of renewables imposes significant costs to the system operators. The added costs depend on several factors including market design, performance of renewable generation forecasting and 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…
Recent events such as the Heparin tragedy, in which patients lost their lives due to tainted pharmaceuticals, highlight the necessity for supply chain designers and planners to consider the risk of even low probability disruptions in supply…
The progressive amplification of fluctuations in demand as the demand travels upstream the supply chains is known as the bullwhip effect. We first analytically characterize the bullwhip effect in general supply chain networks in two cases:…
It was recently recognized that interdependencies among different networks can play a crucial role in triggering cascading failures and hence system-wide disasters. A recent model shows how pairs of interdependent networks can exhibit an…