The Cross‐Industry Contagion Network of Systemic Risk: Evidence From China

Limei Sun, Qing Shen and Xiaoqing Huang

Asian-Pacific Economic Literature, 2025, vol. 39, issue 2, 104-121

Abstract: This study employs the Lasso–Granger algorithm, in combination with sliding window technology, to construct a dynamic directed complex network that captures the dynamics of systemic risk transmission between the financial industry and the real economy. By analysing the network's characteristic indicators among the banking, securities, and insurance sectors, we explore variations in systemic risk transmission across these three major financial sectors and the real economy. Additionally, the CONCOR algorithm is used to detect community structures within the complex network, enabling a dynamic assessment of these communities' attributes over time. The empirical results show that the ability of the insurance, banking, and securities sectors to receive systemic risk weakens progressively. The insurance sector has the strongest capacity to transmit systemic risk, whereas the banking sector has the weakest capacity to transmit systemic risk. The banking and insurance sectors exhibit similar role attributes in the process of systemic risk transmission. The risk transmission relationship between the real economy and the financial industry shows heterogeneity.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/apel.12446

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:apacel:v:39:y:2025:i:2:p:104-121

Ordering information: This journal article can be ordered from
https://ordering.onl ... 7-8411&ref=1467-8411

Access Statistics for this article

Asian-Pacific Economic Literature is currently edited by Yixiao Zhou

More articles in Asian-Pacific Economic Literature from The Crawford School, The Australian National University
Bibliographic data for series maintained by Wiley Content Delivery ().