Liu, Anqi; Paddrik, Mark E.; Yang, Steve Y.; Zhang, Xingjia - 2017
endogenous individual bank choices are necessary to properly consider how losses develop as the interbank lending network evolves … network framework for contagion. The model formulation reproduces dynamics similar to those of the 2007-09 financial crisis … and shows how bank losses and failures arise from network contagion and lending market illiquidity. When calibrated to …