Internal links and pairs as a new tool for the analysis of bipartite complex networks

Many real-world complex networks are best modeled as bipartite (or 2-mode) graphs, where nodes are divided into two sets with links connecting one side to the other. However, there is currently a lack of methods to analyze properly such graphs as most existing measures and methods are suited to classical graphs. A usual but limited approach consists in deriving 1-mode graphs (called projections) from the underlying bipartite structure, though it causes important loss of information and data storage issues. We introduce here internal links and pairs as a new notion useful for such analysis: it gives insights on the information lost by projecting the bipartite graph. We illustrate the relevance of theses concepts on several real-world instances illustrating how it enables to discriminate behaviors among various cases when we compare them to a benchmark of random networks. Then, we show that we can draw benefit from this concept for both modeling complex networks and storing them in a compact format

Statistically validated network of portfolio overlaps and systemic risk

Common asset holding by financial institutions, namely portfolio overlap, is nowadays regarded as an important channel for financial contagion with the potential to trigger fire sales and thus severe losses at the systemic level. In this paper we propose a method to assess the statistical significance of the overlap between pairs of heterogeneously diversified portfolios, which then allows us to build a validated network of financial institutions where links indicate potential contagion channels due to realized portfolio overlaps. The method is implemented on a historical database of institutional holdings ranging from 1999 to the end of 2013, but can be in general applied to any bipartite network where the presence of similar sets of neighbors is of interest. We find that the proportion of validated network links (i.e., of statistically significant overlaps) increased steadily before the 2007-2008 global financial crisis and reached a maximum when the crisis occurred. We argue that the nature of this measure implies that systemic risk from fire sales liquidation was maximal at that time. After a sharp drop in 2008, systemic risk resumed its growth in 2009, with a notable acceleration in 2013, reaching levels not seen since 2007. We finally show that market trends tend to be amplified in the portfolios identified by the algorithm, such that it is possible to have an informative signal about financial institutions that are about to suffer (enjoy) the most significant losses (gains)

Structure of Heterogeneous Networks

Heterogeneous networks play a key role in the evolution of communities and the decisions individuals make. These networks link different types of entities, for example, people and the events they attend. Network analysis algorithms usually project such networks unto simple graphs composed of entities of a single type. In the process, they conflate relations between entities of different types and loose important structural information. We develop a mathematical framework that can be used to compactly represent and analyze heterogeneous networks that combine multiple entity and link types. We generalize Bonacich centrality, which measures connectivity between nodes by the number of paths between them, to heterogeneous networks and use this measure to study network structure. Specifically, we extend the popular modularity-maximization method for community detection to use this centrality metric. We also rank nodes based on their connectivity to other nodes. One advantage of this centrality metric is that it has a tunable parameter we can use to set the length scale of interactions. By studying how rankings change with this parameter allows us to identify important nodes in the network. We apply the proposed method to analyze the structure of several heterogeneous networks. We show that exploiting additional sources of evidence corresponding to links between, as well as among, different entity types yields new insights into network structure

Random graphs with arbitrary degree distributions and their applications

Recent work on the structure of social networks and the internet has focussed attention on graphs with distributions of vertex degree that are significantly different from the Poisson degree distributions that have been widely studied in the past. In this paper we develop in detail the theory of random graphs with arbitrary degree distributions. In addition to simple undirected, unipartite graphs, we examine the properties of directed and bipartite graphs. Among other results, we derive exact expressions for the position of the phase transition at which a giant component first forms, the mean component size, the size of the giant component if there is one, the mean number of vertices a certain distance away from a randomly chosen vertex, and the average vertex-vertex distance within a graph. We apply our theory to some real-world graphs, including the world-wide web and collaboration graphs of scientists and Fortune 1000 company directors. We demonstrate that in some cases random graphs with appropriate distributions of vertex degree predict with surprising accuracy the behavior of the real world, while in others there is a measurable discrepancy between theory and reality, perhaps indicating the presence of additional social structure in the network that is not captured by the random graph.Comment: 19 pages, 11 figures, some new material added in this version along with minor updates and correction

Topics in social network analysis and network science

This chapter introduces statistical methods used in the analysis of social networks and in the rapidly evolving parallel-field of network science. Although several instances of social network analysis in health services research have appeared recently, the majority involve only the most basic methods and thus scratch the surface of what might be accomplished. Cutting-edge methods using relevant examples and illustrations in health services research are provided

Disentangling agglomeration and network externalities : a conceptual typology

Agglomeration and network externalities are fuzzy concepts. When different meanings are (un)intentionally juxtaposed in analyses of the agglomeration/network externalities-menagerie, researchers may reach inaccurate conclusions about how they interlock. Both externality types can be analytically combined, but only when one adopts a coherent approach to their conceptualization and operationalization, to which end we provide a combinatorial typology. We illustrate the typology by applying a state-of-the-art bipartite network projection detailing the presence of globalized producer services firms in cities in 2012. This leads to two one-mode graphs that can be validly interpreted as topological renderings of agglomeration and network externalities