Systemic risk and stability in financial networks

Acemoglu, D., Ozdaglar, & Tahbaz-Salehi, A. (2015). Systemic risk and stability in financial networks. American Economic Review, 105(2), 564-608.

Type

Journal article

Intellectual base

Primary research

Year

2015

Link

https://doi.org/10.1257/aer.20130456verified

Cited from

economics_finance

Cited by

1 citation across 1 artifact.

Each citation links to the sentence it supports in the citing article.

Primes

• Systemic Risk
  • It separates two regimes (a sparsely coupled system in which failures stay local, and a densely coupled system in which failures correlate and cascade) and names the topological conditions under which a system crosses from the first into the second.

    This sourceEstablishes a phase transition in which denser interconnection enhances stability below a shock threshold but propagates and amplifies shocks above it; supports the two-regime (sparse vs. dense) structural signature and the claim that diversification within a coupled network can amplify rather than reduce exposure.

Verification

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