nep-net New Economics Papers
on Network Economics
Issue of 2022‒10‒24
seven papers chosen by
Alfonso Rosa García
Universidad de Murcia

  1. Nestedness in the Brazilian Financial System By Michel Alexandre; Felipe Jordão Xavier; Thiago Christiano Silva; Francisco A. Rodrigues
  2. Heterogeneous peer effects and gender-based interventions for teenage obesity By Margherita Comola; Rokhaya Dieye; Bernard Fortin
  3. Regional Diffusion of Foreign Demand Shocks Through Trade and Ownership Networks By Lionel Fontagné; Gianluca Santoni
  4. The Limits to Local Insurance By Johannes Gierlinger; Pau Milán
  5. Banking across Borders in Luxembourg By Gabriele Di Filippo
  6. Which Peer Group to Choose? The Effects of Relative Performance Information on Employee Self-Selection and Performance By Petra Nieken; Anna Ressi
  7. Foreign demand shocks to production networks: Firm responses and worker impacts By Emmanuel Dhyne; Ayumu Ken Kikkawa; Toshiaki Komatsu; Magne Mogstad; Felix Tintelnot,

  1. By: Michel Alexandre; Felipe Jordão Xavier; Thiago Christiano Silva; Francisco A. Rodrigues
    Abstract: In this paper, we assess the nestedness in the Brazilian financial system. We rely on data from two Brazilian financial networks: the bank-firm credit network and the interbank network. We computed the nestedness of the networks, as well as the Individual Nestedness Contribution (INC) for each node. The analysis of the determinants of the INC shows lenders – in both networks – have their INC mainly determined by the degree, while the INC of borrowers has not a clear main determinant. Moreover, we found nodes with a higher INC would cause more damage to the network if they were hit by a shock, but are not necessarily those more vulnerable to shocks on the network.
    Date: 2022–09
  2. By: Margherita Comola; Rokhaya Dieye; Bernard Fortin
    Abstract: This paper explores the role of gender heterogeneity in the social diffusion of obesity among adolescents and its policy implications. We propose a generalized linear social interaction model which allows for gender-dependent heterogeneity in peer effects through the channel of social synergy. We estimate the model using data on adolescent Body Mass Index and network-based interactions. Our results show that peer effects are gender-dependent, and male students are particularly responsive to the weight of their female friends. Our simulations indicate that female-tailored interventions are likely to be more effective than a gender-neutral approach to fight obesity in schools. Cet article explore le rôle de l'hétérogénéité selon le sexe dans la diffusion sociale de l'obésité chez les adolescents et ses implications politiques. Nous proposons un modèle d’interaction sociale généralisé qui tient compte de l'hétérogénéité des effets des pairs selon le sexe par le biais de la synergie sociale. Nous estimons le modèle à l'aide de données sur l'indice de masse corporelle des adolescents et des liens d’amitié observés dans les réseaux sociaux. Nos résultats montrent que les effets des pairs dépendent du sexe, et que les étudiants masculins sont particulièrement sensibles au poids de leurs amies dans leur comportement de lutte à l’obésité. Nos simulations indiquent que des interventions adaptées aux filles sont susceptibles d'être plus efficaces qu'une approche neutre en termes de genre pour lutter contre l'obésité dans les écoles.
    Keywords: Obesity,Social Networks,Gender,Heterogeneity, Obésité,Réseaux sociaux,Genre,Hétérogénéité
    JEL: L12 C31 Z13 D85
    Date: 2022–09–29
  3. By: Lionel Fontagné; Gianluca Santoni
    Abstract: International demand shocks are transmitted within the trade and ownership firms' networks and impact directly or indirectly domestic firm productivity and labor misallocation. Considering manufacturing firms for Italy, Spain and France over the period 2009-2017, we quantify these transmission channels from the global economy to the domestic firms, and within the domestic economy across locations, sectors and firms. We compute in a shift share fashion international demand shock at the district-sector-year level as plausibly exogenous to individual firms. Our results confirm that global shocks are transmitted through trade networks and that this transmission is largely mediated by firms' ownership networks both across and within the borders of the three countries.
    Keywords: Globalization;Productivity;Networks;FDI
    JEL: F14 F23 F61
    Date: 2022–09
  4. By: Johannes Gierlinger; Pau Milán
    Abstract: We study decentralized insurance when multiple risks are payoff-relevant, but each agent may only trade a (possibly different) subset of risks. Unless (at least) one agent can trade every risk, insurance markets remain incomplete, and the economy is not resilient to worst-case events. We also identify spill overs in any feasible allocation: others’ inability to trade some risks restricts an agent’s resilience to joint realizations. Unless an agent can trade a superset of i’s risks, agent i is not resilient to them. In an application, we model constraints as risk-sharing networks and measure resilience in a Malawian village.
    Keywords: risk sharing, incomplete markets, market insurance, Networks
    JEL: D11 D52 D53 D85 G52
    Date: 2021–10
  5. By: Gabriele Di Filippo
    Abstract: This paper examines the role of Luxembourg in the international banking system through the Locational Banking Statistics compiled by the Bank for International Settlements. Across European countries, Luxembourg features the largest cross-border banking positions relative to GDP. Indeed, Luxembourg is a small open economy with an international financial centre, whose banking sector consists mostly of foreign-controlled banks. The cross-border banking positions focus on loans and deposits between banks and notably intragroup positions. The geographical counterparts of cross-border banking positions in Luxembourg are mainly Western European countries (especially the euro area) and North America (notably the United States), whether for claims or liabilities. By order of importance, the main country counterparts are Germany, France, Great Britain, Switzerland, Italy, the United States, the Netherlands and Belgium. Within the international banking network, the importance of cross-border banking positions in Luxembourg resembles that of Belgium, Ireland, Japan and the Netherlands. These countries feature fewer connections than the United States, Germany and France. At the top of the network, Great Britain stands as the leading international banking centre. The structure of the international banking network evolves over time. During periods of financial stress, the density of connections stagnates or diminishes and the network becomes less resilient. This was notably the case during the global financial crisis of 2007-2008 and the European sovereign debt crisis of 2010-2012. Over time, the international banking network became more fragmented with more communities developing. This suggests a regionalisation of cross-border banking flows, as cross-border banking activity becomes more concentrated within specific groups of countries.
    Keywords: Cross-border banking positions, BIS Locational Banking Statistics, Network analysis
    JEL: F30 E50
    Date: 2022–09
  6. By: Petra Nieken; Anna Ressi
    Abstract: This paper reports results of two controlled experiments on the behavioural effects of relative performance information (RPI) in different organizational structures. Our baseline study 1 focuses on a centralized organizational structure where employees are exogenously assigned to either a high-performing or a low-performing peer group. We find that RPI boosts performances when employees are assigned to the low-performing group. In contrast, when assigned to the high-performing group, our results point to a discouragement effect of RPI that can be attributed to low-performers. In study 2, we show that this or similarly undesired effects do not play a crucial role under a decentralized organizational structure where employees can self-select. In fact, we demonstrate that RPI especially induces employees with a relatively low performance to voluntarily choose the high-performing group. Analyzing subsequent performances suggests that providing self-selection options allows employees to use the high-performing group as a self-set target to spur motivation.
    Keywords: peer groups, self-selection, reference points, relative performance information
    JEL: C91 D83 D91 M52
    Date: 2022
  7. By: Emmanuel Dhyne (: Economics and Research Department, National Bank of Belgium); Ayumu Ken Kikkawa (Sauder School of Business, UBC); Toshiaki Komatsu (University of Chicago); Magne Mogstad (University of Chicago and NBER); Felix Tintelnot, (University of Chicago and NBER)
    Abstract: We quantify and explain the firm responses and worker impacts of foreign demand shocks to domestic production networks. To capture that firms can be indirectly exposed to such shocks by buying from or selling to domestic firms that import or export, we use Belgian data with information on both domestic firm-to-firm sales and foreign trade transactions. Our estimates of firm responses suggest that Belgian firms pass on a large share of a foreign demand shock to their domestic suppliers, face upward-sloping labor supply curves, and have sizable fixed overhead costs in labor. Motivated and guided by these findings, we develop and estimate an equilibrium model that allows us to study how idiosyncratic and aggregate changes in foreign demand propagate through a small open economy and affect firms and workers. Our results suggest that the way the labor market is typically modeled in existing research on foreign demand shocks — with no fixed costs and perfectly elastic labor supply — would grossly understate the decline in real wages due to an increase in foreign tariffs.
    Keywords: : Production networks, Foreign demand shocks, Imperfect labor market, Fixed costs.
    JEL: F16 J22 E00
    Date: 2022–09

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