This paper provides a mapping from portfolio risk diversification into the pairwise correlation between portfolios. In a finite market of uncorrelated assets, portfolio risk is reduced by increasing diversification. However, higher the diversification level, the greater is the overlap between...

Individual risk preferences can be identified by using decision models with tuned parameters that maximally fit a set of risky choices made by a decision maker. A goal of this model fitting procedure is to isolate parameters that correspond to stable risk preferences. These preferences can be...

This study investigates flood avalanches in a dense reservoir network in the semiarid north-eastern Brazil. The population living in this area strongly depends on the availability of the water from this network. Water is stored during intense wet-season rainfall events and evaporates from the...

We study a vehicular traffic scenario on Swiss roads in an emergency situation, calculating how sequentially roads block due to excessive traffic load until global collapse (gridlock) occurs and in this way displays the fragilities of the system. We used a database from Bundesamt f\"ur...

Many systems exhibit patterns of interaction that are largely sparse and volatile at the same time. Sparsity is a common trait in networks where links are costly, or the nodes involved have some kind of limited capacity. Volatility refers to the fact that edges tend to have very low persistence...

External or internal shocks may lead to the collapse of a system consisting of many agents. If the shock hits only one agent initially and causes it to fail, this can induce a cascade of failures among neighoring agents. Several critical constellations determine whether this cascade remains...

The structure of a society depends, to some extent, on the incentives of the individuals they are composed of. We study a stylized model of this interplay, that suggests that the more individuals aim at climbing the social hierarchy, the more society's hierarchy gets strong. Such a dependence is...