Multilayer Financial Complex Networks and Their Applications

Abstract

In the context of global integration, the theory of financial complex networks has made significant contributions to the establishment of stable financial systems and effective regulatory systems. This survey paper presents a systematic methodology for the multi-layer financial complex networks and their applications. Several typical financial networks in existing research are first summarized: the interbank network, the credit network, the international trade network, and the dealer network. The main methods used in the existing literature to analyze the structure of financial networks include maximum entropy methods, network characterization, community detection, and dynamic multi-layer network. Financial risk contagion as well as spillover effects are the core issues that most of the literature focuses on. Finally, this paper reviews the shortcomings of the existing literature and suggests future research directions in this area.