Structure and Dynamics of the Global Financial Network

Thiago Silva (), Sergio Souza and Benjamin Tabak

No 439, Working Papers Series from Central Bank of Brazil, Research Department

Abstract: In this paper, we study the evolution of the network topology for the global financial market. We evaluate the level of diversification and participation of developed and emerging economies in cross-border exposures and find that the gross exposure network is dense, the vulnerability matrix is sparse, and the network's fragility changes over time. Prior to the financial crisis in 2008, the network was relatively fragile, whereas it became more resilient afterwards, showing a reduction in financial institutions risk appetite. Our results suggest that financial regulators should track down the network evolution in their systemic risk assessment.

Date: 2016-06
New Economics Papers: this item is included in nep-fmk, nep-net and nep-rmg
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Citations: View citations in EconPapers (19)

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Journal Article: Structure and dynamics of the global financial network (2016)
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