Partially Overlapping Ownership and Contagion in Financial Networks

Figure 5

Contagions with a Common Asset. Probability of a contagion ((a) and (b)) and average extent of contagion ((c) and (d)) for a core-periphery network with a common asset and direct exposures (black solid circles) and direct exposures only (red empty circles) conditioned on a random core bank failing ((a) and (c)) and conditioned on a random periphery bank failing ((b) and (d)). Contagion extent shown only when average contagion frequency is greater than 1%.

(a) Contagion probability (core node)

(b) Contagion probability (periphery node)

(c) Contagion extent (core node)

(d) Contagion extent (periphery node)