Network integration and financial crisis
Two University of Arkansas researchers are studying how integration into the global trade network may impact vulneratiblity to financial crises. [Link]
The researchers constructed novel network-based measures of connectedness – that is, the extent to which a country is integrated into the global trading system – and found that crises in “epicenter” countries – countries in which crises originated – were amplified if the country was better integrated into the trade network. On the other hand, “target” countries affected by these financial shocks were better able to cushion the impact of the crises if they too were well integrated into the global trading network.
