We study a new model to study the effect of contract externalities that arise through shock transmission. We model a … financial network where good firms enjoy direct and indirect benefits from linking with one another. Bad risks benefit from …

The objective of this research is to examine the inter-bank network of clients as a channel for credit risk … groups of banks have experienced increase in NPLs through the channel of contagion spread in the interbank network. The … spread of the infection through the banking network is a consequence of the impact of the economic connection among clients …

We examine the effects on a financial network of clearing all contracts though a central node (CN) thereby transforming … the original network into a star-shaped one. The CN is capitalized with external equity and a guaranty fund. We introduce …

markets in the short-run only. Comparing different interbank network structures, it is shown that money-center networks are …

In this paper, I incorporate a complex network model into a state of the art stochastic general equilibrium framework … the tools of network analysis it is possible to study how contagion spreads between banks and what is the probability and … phase transition when the consequences of one single initial shock affect the entire population. I show that the size and …