JIANG Ruochen, LU Xuan:Empirical Study on Macro Topologic Properties and Systematic Credit Risks of China's Credit Network

Abstract：This paper conducts systematic study on the macro topologic properties of financial intuitions-firms credit network from the complex network prospective.Firstly, by analyzing the degree and edge weight distributions, there exists a significant heterogeneity and “Scale-free” property in the whole credit network.Secondly, it is the first time that the disassortativity and “Rich-club” phenomenon are found in one network simultaneously, leading to a remarkable “Core-periphery” pattern.Thirdly, three clear layers are clearly identified when employing the minimum spanning tree approach, which verifies the existence of the hierarchical modularity in China's credit network.Finally, applying the CRR, a new feedback centrality-liked index, we find only a few entities whose defaults would exert great impact on the whole credit network, which demonstrates heterogeneity of the credit risks.Based on CRR, a new differential risks regulation is proposed, whose effectiveness is validated via three targeted immunization strategies.This paper provides some references for policy guidance, optimizing the allocation of regulation resources and strengthening the stability of the credit system in China.

Key words： Credit Network   Macro Topology Properties   “Scale-free” Network   “Core-periphery” Pattern   Credit Risk Rank

source:Finance & Trade Economics ,No.11,2014