D'Erasmo, Pablo; Erol, Selman; Ordoñez, Guillermo - 2022
. This endogenous network reaction to the regulation creates the unanticipated effect of reducing financial stability through … derivatives, arguably to create a less complex and more transparent interbank network that is less prone to financial … instabilities. We construct a network model with endogenous exposures and show that the core and the periphery react asymmetrically …