Stochastic network formation and homophily

This is a chapter of the forthcoming Oxford Handbook on the Economics of Networks

A survey of random processes with reinforcement

The models surveyed include generalized P\'{o}lya urns, reinforced random walks, interacting urn models, and continuous reinforced processes. Emphasis is on methods and results, with sketches provided of some proofs. Applications are discussed in statistics, biology, economics and a number of other areas.Comment: Published at http://dx.doi.org/10.1214/07-PS094 in the Probability Surveys (http://www.i-journals.org/ps/) by the Institute of Mathematical Statistics (http://www.imstat.org

A Complex Political Economy of the Global Banking System

The global financial crisis which began in 2007 is the most severe economic event since the 1930s. The profound political and economic consequences of the crisis have clarified the need to better understand the financial system at both micro and macro levels. This dissertation advances research on both fronts. First, it utilizes network prominence measures to look at the pre- and post-crisis organization of the global banking system, finding that American prestige has increased as a result of the crisis. Second, it employs complex network theory and inferential statistical models to explain why the global banking system is organized as it is, finding that endogenous processes interact with monadic and dyadic political economy variables to produce a global structure. Third, it examines bank behaviors at the firm level, demonstrates that representative agent models are insufficient for explaining the patterns observed, proposes an alternative approach drawing from ecological finance theory, tests the model using Bayesian regression, and finds support for the new approach. In sum, this dissertation demonstrates the need for further quantitative political economy work at both the micro and macro levels of the global financial system and provides several possible pathways forward.Doctor of Philosoph

Essays on credit contagion and shocks in banking

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Topology Reconstruction of Dynamical Networks via Constrained Lyapunov Equations

The network structure (or topology) of a dynamical network is often unavailable or uncertain. Hence, we consider the problem of network reconstruction. Network reconstruction aims at inferring the topology of a dynamical network using measurements obtained from the network. In this technical note we define the notion of solvability of the network reconstruction problem. Subsequently, we provide necessary and sufficient conditions under which the network reconstruction problem is solvable. Finally, using constrained Lyapunov equations, we establish novel network reconstruction algorithms, applicable to general dynamical networks. We also provide specialized algorithms for specific network dynamics, such as the well-known consensus and adjacency dynamics.Comment: 8 page

Statistical physics of vaccination

Historically, infectious diseases caused considerable damage to human societies, and they continue to do so today. To help reduce their impact, mathematical models of disease transmission have been studied to help understand disease dynamics and inform prevention strategies. Vaccination–one of the most important preventive measures of modern times–is of great interest both theoretically and empirically. And in contrast to traditional approaches, recent research increasingly explores the pivotal implications of individual behavior and heterogeneous contact patterns in populations. Our report reviews the developmental arc of theoretical epidemiology with emphasis on vaccination, as it led from classical models assuming homogeneously mixing (mean-field) populations and ignoring human behavior, to recent models that account for behavioral feedback and/or population spatial/social structure. Many of the methods used originated in statistical physics, such as lattice and network models, and their associated analytical frameworks. Similarly, the feedback loop between vaccinating behavior and disease propagation forms a coupled nonlinear system with analogs in physics. We also review the new paradigm of digital epidemiology, wherein sources of digital data such as online social media are mined for high-resolution information on epidemiologically relevant individual behavior. Armed with the tools and concepts of statistical physics, and further assisted by new sources of digital data, models that capture nonlinear interactions between behavior and disease dynamics offer a novel way of modeling real-world phenomena, and can help improve health outcomes. We conclude the review by discussing open problems in the field and promising directions for future research

Resilience of the Critical Communication Networks Against Spreading Failures: Case of the European National and Research Networks

A backbone network is the central part of the communication network, which provides connectivity within the various systems across large distances. Disruptions in a backbone network would cause severe consequences which could manifest in the service outage on a large scale. Depending on the size and the importance of the network, its failure could leave a substantial impact on the area it is associated with. The failures of the network services could lead to a significant disturbance of human activities. Therefore, making backbone communication networks more resilient directly affects the resilience of the area. Contemporary urban and regional development overwhelmingly converges with the communication infrastructure expansion and their obvious mutual interconnections become more reciprocal. Spreading failures are of particular interest. They usually originate in a single network segment and then spread to the rest of network often causing a global collapse. Two types of spreading failures are given focus, namely: epidemics and cascading failures. How to make backbone networks more resilient against spreading failures? How to tune the topology or additionally protect nodes or links in order to mitigate an effect of the potential failure? Those are the main questions addressed in this thesis. First, the epidemic phenomena are discussed. The subjects of epidemic modeling and identification of the most influential spreaders are addressed using a proposed Linear Time-Invariant (LTI) system approach. Throughout the years, LTI system theory has been used mostly to describe electrical circuits and networks. LTI is suitable to characterize the behavior of the system consisting of numerous interconnected components. The results presented in this thesis show that the same mathematical toolbox could be used for the complex network analysis. Then, cascading failures are discussed. Like any system which can be modeled using an interdependence graph with limited capacity of either nodes or edges, backbone networks are prone to cascades. Numerical simulations are used to model such failures. The resilience of European National Research and Education Networks (NREN) is assessed, weak points and critical areas of the network are identified and the suggestions for its modification are proposed