Academic Journal
Cascades in Networks and Aggregate Volatility
| العنوان: | Cascades in Networks and Aggregate Volatility |
|---|---|
| المؤلفون: | Daron Acemoglu, Asuman Ozdaglar |
| المساهمون: | The Pennsylvania State University CiteSeerX Archives |
| المصدر: | http://economics.mit.edu/files/6147/. |
| سنة النشر: | 2012 |
| المجموعة: | CiteSeerX |
| مصطلحات موضوعية: | Aggregate volatility, risk, cascades, input-output structure, supply networks, Laws of large numbers |
| الوصف: | We provide a general framework for the study of cascade effects created by interconnec-tions between sectors, firms or financial institutions. Focusing on a multi-sector economy linked through a supply network, we show how structural properties of the supply network determine both whether aggregate volatility disappears as the number of sectors increases (i.e., whether the law of large numbers holds) and when it does, the rate at which this hap-pens. Our main results characterize the relationship between first-order interconnections (captured by the weighted degree sequence in the graph induced by the input-output rela-tions) and aggregate volatility, and more importantly, the relationship between higher-order interconnections and aggregate volatility. These higher-order interconnections capture the cascade effects, whereby low productivity or the failure of a set of suppliers propagates through the rest of the economy as their downstream sectors/firms also suffer and trans-mit the negative shock to their downstream sectors/firms. We also link the probabilities of tail events (large negative deviations of aggregate output from its mean) to sector-specific |
| نوع الوثيقة: | text |
| اللغة: | English |
| Relation: | http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.683.6864; http://economics.mit.edu/files/6147/ |
| الاتاحة: | http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.683.6864 http://economics.mit.edu/files/6147/ |
| Rights: | Metadata may be used without restrictions as long as the oai identifier remains attached to it. |
| رقم الانضمام: | edsbas.A61FB053 |
| قاعدة البيانات: | BASE |
| الوصف غير متاح. |