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Beyond FOC - Announcement

Tue, 09/24/2013 - 18:07 -- manager

Some of the partners will build on the results of FOC and continue to work on financial network and systemic risk within some new projects. Some of them are listed here.

 

 

SIMPOL (Financial Systems Simulation and Policy Modelling)

This project proceeds from the vision that fundamental advances of policy modelling in finance and climate finance can only stem from a genuinely interdisciplinary approach where network science, big data and ICT’s meet economics and financial regulation. We will deliver tools that allow regulators to make better-informed decisions and that increase the transparency of the decision process for citizens and stakeholders. On the one hand, we will develop new methods to assess the systemic importance of market players in (climate) financial networks and we will evaluate the effect of regulations in close collaborations with representatives of various regulatory bodies. The results will contribute to the discussion on how financial innovations could ignite a transition towards a greener economy and a more sustainable financial system. On the other hand, we will leverage on open data initiatives and semantic web to empower citizens with a more active role in relation to EU policies, by crowd-sourcing the task to map the networks of influence involved in the policy making process.

Coordinator: Prof. Stefano Battiston, Dept of Banking and Finance, Univ. Zurich

Partners: Univ. of Zurich, IMT Lucca, London Institute of Mathematical Science, Global Climate Forum, Univ. Paris 1, Josef Stefan Institute. 

Open Positions - Go to the APPLICATION FORM

 

 

SNF - Financial Networks and Systemic Risk 

Swiss National Fund Project at Dept. of Banking and Finance, Univ. of Zurich -

The project approaches systemic risk from a network perspective, combining modeling, empirical analysis and policy applications. It builds on previous work and leverages on synergies with several international projects. It contributes to fundamental questions on resilience and sustainability of the financial system. It also delivers practical output in collaboration with policy makers, by incorporating network effects in the current stress-testing methods.

Research questions. There are several types of financial ties. In the simplest case, institutions have interlinked balance sheets (Morris and Shin, 2008; Rochet and Tirole, 1996) since the liability of one is an asset for another one. Two institutions may get indirectly connected when they gain exposure to a common external asset or asset class (Allen et al., 2011; Beale et al., 2011). Similarly, two institutions may depend on a common external lender. Finally, two institutions may be perceived by the market as similar or interdependent, even though they do not have any objective linkage. In this case, the distress of one may still propagate to the other as in the bank-run dynamics (Diamond and Dybvig, 1983). Regardless of the origin of the links, an institution is able to impact the connected institutions and these further impact on those they are connected to (Battiston et al., 2012a,b; Lorenz et al., 2009). The research questions that this project intends to address include: (1) which network architectures are resilient to endogenous and exogenous shocks; (2) which incentive structure led the system into the current architecture; (3) how can we anticipate systemic distress by means of simple indicators and stress-tests; (4) how can we make the financial system more resilient and what policies could modify the incentives in such a direction. 

Coordinator: Prof. Stefano Battiston, Dept of Banking and Finance, Univ. Zurich

Open Positions - Go to the APPLICATION FORM