Models of “contagion” rely on market imperfections to explain why adverse shocks in one asset market might be associated with asset sales in many unrelated

No sooner had the Asian crisis broken out in 1997 than the witch-hunt started. With great indignation every Asian economy pointed fingers. They were innocent by

What can the international community do to prevent financial contagion?

This paper presents a novel approach to investigate and model the network of euro area banks’ large exposures within the global banking system. Drawing on a u