Corpus ID: 235658018

Hierarchical contagions in the interdependent financial network

  title={Hierarchical contagions in the interdependent financial network},
  author={William A. Barnett and Xue Wang and Hai-Chuan Xu and Wei-Xing Zhou},
We model hierarchical cascades of failures among banks linked through an interdependent network. The interaction among banks include not only direct cross-holding, but also indirect dependency by holding mutual assets outside the banking system. Using data extracted from the European Banking Authority, we present the interdependency network composed of 48 banks and 21 asset classes. Since interbank exposures are not public, we first reconstruct the asset/liability cross-holding network using… Expand

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