Financial Replicator Dynamics: Emergence of Systemic-Risk-Averting Strategies

@inproceedings{Saha2020FinancialRD,
  title={Financial Replicator Dynamics: Emergence of Systemic-Risk-Averting Strategies},
  author={Indrajit Saha and Veeraruna Kavitha},
  booktitle={International Conference on Network Games, Control and Optimization},
  year={2020}
}
We consider a random financial network with a large number of agents. The agents connect through credit instruments borrowed from each other or through direct lending, and these create the liabilities. The settlement of the debts of various agents at the end of the contract period can be expressed as solutions of random fixed point equations. Our first step is to derive these solutions (asymptotically), using a recent result on random fixed point equations. We consider a large population in… 

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