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Randomizing world trade. II. A weighted network analysis

By Tiziano Squartini, Giorgio Fagiolo and Diego Garlaschelli

Abstract

Based on the misleading expectation that weighted network properties always offer a more complete description than purely topological ones, current economic models of the International Trade Network (ITN) generally aim at explaining local weighted properties, not local binary ones. Here we complement our analysis of the binary projections of the ITN by considering its weighted representations. We show that, unlike the binary case, all possible weighted representations of the ITN (directed/undirected, aggregated/disaggregated) cannot be traced back to local country-specific properties, which are therefore of limited informativeness. Our two papers show that traditional macroeconomic approaches systematically fail to capture the key properties of the ITN. In the binary case, they do not focus on the degree sequence and hence cannot characterize or replicate higher-order properties. In the weighted case, they generally focus on the strength sequence, but the knowledge of the latter is not enough in order to understand or reproduce indirect effects.Comment: See also the companion paper (Part I): arXiv:1103.1243 [physics.soc-ph], published as Phys. Rev. E 84, 046117 (2011

Topics: Physics - Physics and Society, Condensed Matter - Statistical Mechanics, Computer Science - Social and Information Networks, Physics - Data Analysis, Statistics and Probability, Quantitative Finance - General Finance
Year: 2011
DOI identifier: 10.1103/PhysRevE.84.046118
OAI identifier: oai:arXiv.org:1103.1249
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