The EU Public Debt Synchronization: A Complex Networks Approach

Fotios Gkatzoglou, Emmanouil Sofianos and Amélie Barbier-Gauchard ()
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Fotios Gkatzoglou: DUTH - Democritus University of Thrace
Emmanouil Sofianos: BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Amélie Barbier-Gauchard: BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

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Abstract: This study examines the evolution of public debt among the 27 EU member states using Graph Theory tools; the Threshold Weighted-Minimum Dominating Set (TW-MDS) and the k-core decomposition method, alongside a standard network quantitative metric, the density. By separating the data into three distinct periods, pre-crisis (2000-2007), European sovereign debt crisis (2008-2015), and post-crisis (2016-2023), we examine the potential synchronization of the debt ratios among EU countries through cross-correlations of the public debts. The findings reveal that public debt correlation was at its highest level during the 2008-2015 period, reflecting the universal impact of the crisis and the subsequent synchronized fiscal and monetary policy measures taken within EU. A significantly lower network density is observed in both the pre-and post-crisis periods. These results contribute to the overall debate on fiscal stability and policy coordination by showing how EU countries tend to align their fiscal behaviors during periods of crisis while behaving more independently during stable times. In addition, we yield a deeper insight into how economic shocks reorganize public debt interconnections within the crisis period. Finally, this analysis highlights to what extent European economic integration strengthens connections between the fiscal positions (through public debt) of the European Union member countries.

Keywords: E62; C63; O52; graph theory JEL Classification: H63; synchronization; correlation; complex networks; European integration; public debt; public debt European integration complex networks correlation synchronization graph theory JEL Classification: H63 O52 E62 C63 (search for similar items in EconPapers)
Date: 2025-06-27
Note: View the original document on HAL open archive server: https://univoak.hal.science/hal-05464661v1
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Published in Economies, 2025, 13 (7), pp.186. ⟨10.3390/economies13070186⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05464661

DOI: 10.3390/economies13070186

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