TY  - JOUR
VL  - 2
IS  - 541
JF  - (Nature) Scientific Reports
Y1  - 2012/08//
SP  - 1
A1  - Battiston, Stefano
A1  - Puliga, Michelangelo
A1  - Kaushik, Rahul
A1  - Tasca, Paolo
A1  - Caldarelli, Guido
PB  - Nature Publishing Group
EP  - 6
ID  - eprints1331
UR  - http://www.nature.com/srep/2012/120802/srep00541/full/srep00541.html
TI  - DebtRank: Too Central to Fail? Financial Networks, the FED and Systemic Risk
AV  - public
KW  - Applied physics; Modelling and theory; Statistical physics
KW  -  thermodynamics and nonlinear dynamics; Theoretical physics
N2  - Systemic risk, here meant as the risk of default of a large portion of the financial system, depends on the network of financial exposures among institutions. However, there is no widely accepted methodology to determine the systemically important nodes in a network. To fill this gap, we introduce, DebtRank, a novel measure of systemic impact inspired by feedback-centrality. As an application, we analyse a new and unique dataset on the USD 1.2 trillion FED emergency loans program to global financial institutions during 2008?2010. We find that a group of 22 institutions, which received most of the funds, form a strongly connected graph where each of the nodes becomes systemically important at the peak of the crisis. Moreover, a systemic default could have been triggered even by small dispersed shocks. The results suggest that the debate on too-big-to-fail institutions should include the even more serious issue of too-central-to-fail.
SN  - 2045-2322
ER  -