Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives
In 2008, the Lehman Brothers’ bankruptcy, accumulated from the global financial crisis, proved a unique role of the highly interconnected financial entities. Shocks in a bank might trigger loss, induce spillovers, provoke a contagion shock spreading to other entities, trigger the whole banking syste...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
MDPI AG
2022-02-01
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| Series: | Economies |
| Subjects: | |
| Online Access: | https://www.mdpi.com/2227-7099/10/3/56 |
| _version_ | 1797446790302138368 |
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| author | Andry Alamsyah Dian Puteri Ramadhani Farida Titik Kristanti Khairunnisa Khairunnisa |
| author_facet | Andry Alamsyah Dian Puteri Ramadhani Farida Titik Kristanti Khairunnisa Khairunnisa |
| author_sort | Andry Alamsyah |
| collection | DOAJ |
| description | In 2008, the Lehman Brothers’ bankruptcy, accumulated from the global financial crisis, proved a unique role of the highly interconnected financial entities. Shocks in a bank might trigger loss, induce spillovers, provoke a contagion shock spreading to other entities, trigger the whole banking system to collapse, and ultimately unsettle the worldwide economy. Therefore, evaluating financial stability through a system-wide network approach provides more adequate knowledge than evaluating a bank as an individual. In this approach, individual banks and their transaction activities are modeled into a transaction network, forming a network topology. Financial shocks are generally detected through various macro procedures, such as outstanding external debt and uncontrolled transaction deficits. This study proposes financial shock detection from a macro and micro perspective by exploring the effect of disruption on transaction network structure. We investigate the most changing triadic motif as a crisis predictor from a micro perspective due to the crisis period. The case study is the transaction network structural shift under the 2008 crisis in Indonesia, where the observations were performed from the pre-crisis to the post-crisis period. We discovered a motif with the significant changes as the underlying financial crisis predictor. This scenario provides support for the financial system’s stability control. |
| first_indexed | 2024-03-09T13:46:38Z |
| format | Article |
| id | doaj.art-dac90a385a0f483ba4511957278e66fd |
| institution | Directory Open Access Journal |
| issn | 2227-7099 |
| language | English |
| last_indexed | 2024-03-09T13:46:38Z |
| publishDate | 2022-02-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Economies |
| spelling | doaj.art-dac90a385a0f483ba4511957278e66fd2023-11-30T20:59:59ZengMDPI AGEconomies2227-70992022-02-011035610.3390/economies10030056Transaction Network Structural Shift under Crisis: Macro and Micro PerspectivesAndry Alamsyah0Dian Puteri Ramadhani1Farida Titik Kristanti2Khairunnisa Khairunnisa3School of Economic and Business, Telkom University, Bandung 40257, IndonesiaSchool of Economic and Business, Telkom University, Bandung 40257, IndonesiaSchool of Economic and Business, Telkom University, Bandung 40257, IndonesiaSchool of Economic and Business, Telkom University, Bandung 40257, IndonesiaIn 2008, the Lehman Brothers’ bankruptcy, accumulated from the global financial crisis, proved a unique role of the highly interconnected financial entities. Shocks in a bank might trigger loss, induce spillovers, provoke a contagion shock spreading to other entities, trigger the whole banking system to collapse, and ultimately unsettle the worldwide economy. Therefore, evaluating financial stability through a system-wide network approach provides more adequate knowledge than evaluating a bank as an individual. In this approach, individual banks and their transaction activities are modeled into a transaction network, forming a network topology. Financial shocks are generally detected through various macro procedures, such as outstanding external debt and uncontrolled transaction deficits. This study proposes financial shock detection from a macro and micro perspective by exploring the effect of disruption on transaction network structure. We investigate the most changing triadic motif as a crisis predictor from a micro perspective due to the crisis period. The case study is the transaction network structural shift under the 2008 crisis in Indonesia, where the observations were performed from the pre-crisis to the post-crisis period. We discovered a motif with the significant changes as the underlying financial crisis predictor. This scenario provides support for the financial system’s stability control.https://www.mdpi.com/2227-7099/10/3/56transaction networknetwork structurenetwork topologynetwork motifsfinancial crisis |
| spellingShingle | Andry Alamsyah Dian Puteri Ramadhani Farida Titik Kristanti Khairunnisa Khairunnisa Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives Economies transaction network network structure network topology network motifs financial crisis |
| title | Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives |
| title_full | Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives |
| title_fullStr | Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives |
| title_full_unstemmed | Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives |
| title_short | Transaction Network Structural Shift under Crisis: Macro and Micro Perspectives |
| title_sort | transaction network structural shift under crisis macro and micro perspectives |
| topic | transaction network network structure network topology network motifs financial crisis |
| url | https://www.mdpi.com/2227-7099/10/3/56 |
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