I show the equivalence between a model of financial contagion and the widely-used threshold model of global cascades proposed by Watts (2002). The model financial network comprises banks that hold risky external assets as well as interbank assets. It turns out that there is no need to construct...

The question of how to stabilize financial systems has attracted considerable attention since the global financial crisis of 2007-2009. Recently, Beal et al. (gIndividual versus systemic risk and the regulator's dilemmah, Proc Natl Acad Sci USA 108: 12647-12652, 2011) demonstrated that higher...

The problem of how to stabilize the financial system has attracted considerable attention since the global financial crisis of 2007-2009. Recently, Beal et al. (2011, gIndividual versus systemic risk and the regulatorfs dilemmah, Proc Natl Acad Sci USA 108: 12647-12652) demonstrated that higher...

Two issues are addressed in this paper. First, we analyze with a simple mathematical model Thomas Robert Malthusfs critique of Adam Smith, the most theoretically discussed part in the first edition of Principle of Population. Second, by introducing a differential equation for the dynamics of...