2013/01/24 by Eduardo Viegas, Viegas, Eduardo, Misako Takayasu +11
Physics and Astronomy · Economics, Econometrics and Finance · #Opinion Dynamics and Social Influence #Complex Systems and Time Series Analysis #Complex Network Analysis Techniques
paper · pdf · doi:10.48550/arxiv.1301.5821
The economical world consists of a highly interconnected and interdependent network of firms. Here we develop temporal and structural network tools to analyze the state of the economy. Our analysis indicates that a strong clustering can be a warning sign. Reduction in diversity, which was an essential aspect of the dynamics surrounding the crash in 2008, is seen as a key emergent feature arising naturally from the evolutionary and adaptive dynamics inherent to the financial markets. Similarly, collusion amongst construction firms in a number of regions in Japan in the 2000s can be identified with the formation of clusters of anomalous highly connected companies.