Subscribe to the gold package and get unlimited access to Shamra Academy
Register a new userThe Physics of Financial Networks
153
0
0.0
(
0
)
Ask ChatGPT about the research
No Arabic abstract
The field of Financial Networks is a paramount example of the novel applications of Statistical Physics that have made possible by the present data revolution. As the total value of the global financial market has vastly outgrown the value of the real economy, financial institutions on this planet have created a web of interactions whose size and topology calls for a quantitative analysis by means of Complex Networks. Financial Networks are not only a playground for the use of basic tools of statistical physics as ensemble representation and entropy maximization; rather, their particular dynamics and evolution triggered theoretical advancements as the definition of DebtRank to measure the impact and diffusion of shocks in the whole systems. In this review we present the state of the art in this field, starting from the different definitions of financial networks (based either on loans, on assets ownership, on contracts involving several parties -- such as credit default swaps, to multiplex representation when firms are introduced in the game and a link with real economy is drawn) and then discussing the various dynamics of financial contagion as well as applications in financial network inference and validation. We believe that this analysis is particularly timely since financial stability as well as recent innovations in climate finance, once properly analysed and understood in terms of complex network theory, can play a pivotal role in the transformation of our society towards a more sustainable world.
rate research
Read More
Social networks are not static but rather constantly evolve in time. One of the elements thought to drive the evolution of social network structure is homophily - the need for individuals to connect with others who are similar to them. In this paper, we study how the spread of a new opinion, idea, or behavior on such a homophily-driven social network is affected by the changing network structure. In particular, using simulations, we study a variant of the Axelrod model on a network with a homophilic rewiring rule imposed. First, we find that the presence of homophilic rewiring within the network, in general, impedes the reaching of consensus in opinion, as the time to reach consensus diverges exponentially with network size $N$. We then investigate whether the introduction of committed individuals who are rigid in their opinion on a particular issue, can speed up the convergence to consensus on that issue. We demonstrate that as committed agents are added, beyond a critical value of the committed fraction, the consensus time growth becomes logarithmic in network size $N$. Furthermore, we show that slight changes in the interaction rule can produce strikingly different results in the scaling behavior of $T_c$. However, the benefit gained by introducing committed agents is qualitatively preserved across all the interaction rules we consider.
Public opinion is often affected by the presence of committed groups of individuals dedicated to competing points of view. Using a model of pairwise social influence, we study how the presence of such groups within social networks affects the outcome and the speed of evolution of the overall opinion on the network. Earlier work indicated that a single committed group within a dense social network can cause the entire network to quickly adopt the groups opinion (in times scaling logarithmically with the network size), so long as the committed group constitutes more than about 10% of the population (with the findings being qualitatively similar for sparse networks as well). Here we study the more general case of opinion evolution when two groups committed to distinct, competing opinions $A$ and $B$, and constituting fractions $p_A$ and $p_B$ of the total population respectively, are present in the network. We show for stylized social networks (including ErdH{o}s-Renyi random graphs and Barabasi-Albert scale-free networks) that the phase diagram of this system in parameter space $(p_A,p_B)$ consists of two regions, one where two stable steady-states coexist, and the remaining where only a single stable steady-state exists. These two regions are separated by two fold-bifurcation (spinodal) lines which meet tangentially and terminate at a cusp (critical point). We provide further insights to the phase diagram and to the nature of the underlying phase transitions by investigating the model on infinite (mean-field limit), finite complete graphs and finite sparse networks. For the latter case, we also derive the scaling exponent associated with the exponential growth of switching times as a function of the distance from the critical point.
Proximity networks are time-varying graphs representing the closeness among humans moving in a physical space. Their properties have been extensively studied in the past decade as they critically affect the behavior of spreading phenomena and the performance of routing algorithms. Yet, the mechanisms responsible for their observed characteristics remain elusive. Here, we show that many of the observed properties of proximity networks emerge naturally and simultaneously in a simple latent space network model, called dynamic-$mathbb{S}^{1}$. The dynamic-$mathbb{S}^{1}$ does not model node mobility directly, but captures the connectivity in each snapshot---each snapshot in the model is a realization of the $mathbb{S}^{1}$ model of traditional complex networks, which is isomorphic to hyperbolic geometric graphs. By forgoing the motion component the model facilitates mathematical analysis, allowing us to prove the contact, inter-contact and weight distributions. We show that these distributions are power laws in the thermodynamic limit with exponents lying within the ranges observed in real systems. Interestingly, we find that network temperature plays a central role in network dynamics, dictating the exponents of these distributions, the time-aggregated agent degrees, and the formation of unique and recurrent components. Further, we show that paradigmatic epidemic and rumor spreading processes perform similarly in real and modeled networks. The dynamic-$mathbb{S}^{1}$ or extensions of it may apply to other types of time-varying networks and constitute the basis of maximum likelihood estimation methods that infer the node coordinates and their evolution in the latent spaces of real systems.
We propose a network metric, edge proximity, ${cal P}_e$, which demonstrates the importance of specific edges in a network, hitherto not captured by existing network metrics. The effects of removing edges with high ${cal P}_e$ might initially seem inconspicuous but are eventually shown to be very harmful for networks. Compared to existing strategies, the removal of edges by ${cal P}_e$ leads to a remarkable increase in the diameter and average shortest path length in undirected real and random networks till the first disconnection and well beyond. ${cal P}_e$ can be consistently used to rupture the network into two nearly equal parts, thus presenting a very potent strategy to greatly harm a network. Targeting by ${cal P}_e$ causes notable efficiency loss in U.S. and European power grid networks. ${cal P}_e$ identifies proteins with essential cellular functions in protein-protein interaction networks. It pinpoints regulatory neural connections and important portions of the neural and brain networks, respectively. Energy flow interactions identified by ${cal P}_e$ form the backbone of long food web chains. Finally, we scrutinize the potential of ${cal P}_e$ in edge controllability dynamics of directed networks.
We study the effect of heterogeneous temporal activations on epidemic spreading in temporal networks. We focus on the susceptible-infected-susceptible (SIS) model on activity-driven networks with burstiness. By using an activity-based mean-field approach, we derive a closed analytical form for the epidemic threshold for arbitrary activity and inter-event time distributions. We show that, as expected, burstiness lowers the epidemic threshold while its effect on prevalence is twofold. In low-infective systems burstiness raises the average infection probability, while it weakens epidemic spreading for high infectivity. Our results can help clarify the conflicting effects of burstiness reported in the literature. We also discuss the scaling properties at the transition, showing that they are not affected by burstiness.
Log in to be able to interact and post comments
comments
Fetching comments
Sign in to be able to follow your search criteria
