Studies

Systemic Risk in Financial Networks

Professor

 

Alireza Tahbaz-Salehi (Northwestern University)

Dates

 

27-31 August 2018

Hours

 

9:30 to 13:00

Intended for

 

Graduate students, academic economists, and practitioners at central banks and policy-making institutions.

Prerequisites

 

First year graduate-level micro and macroeconomics.

Overview

 

Networks provide a natural framework for the study of interactions among different economic units (industries, firms, banks, regions, etc.). The objective of this course is to familiarize the participants with recent developments in the literature on economic and financial networks, with the main focus on the role of networks as a mechanism for propagation and amplification of shocks. The course starts with a general overview of some basic concepts in graph theory. We then study various models of how real and financial interlinkages can translate microeconomic shocks into aggregate fluctuations and systemic crises.

Topics

 

Basic concepts in graph theory
Networks and the propagation of shocks; input-output networks; aggregate fluctuations
Financial networks and systemic risk
A unifying framework for the role of networks as shock-propagation mechanisms

 

Alireza Tahbaz-Salehi is Associate Professor of Managerial Economics and Decisions Sciences at the Kellogg School of Management, Northwestern University. He has published papers at the American Economic Review, Econometrica, and the Journal of Finance, among others. His research focuses on the implications of network economies for information aggregation, business cycle fluctuations, and financial stability.

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