Xi, N, Muneepeerakul, R, Azaele, S et al. (1 more author) (2014) Maximum entropy model for business cycle synchronization. Physica A: Statistical Mechanics and its Applications, 413. 189 - 194. ISSN 0378-4371
Abstract
The global economy is a complex dynamical system, whose cyclical fluctuations can mainly be characterized by simultaneous recessions or expansions of major economies. Thus, the researches on the synchronization phenomenon are key to understanding and controlling the dynamics of the global economy. Based on a pairwise maximum entropy model, we analyze the business cycle synchronization of the G7 economic system. We obtain a pairwise-interaction network, which exhibits certain clustering structure and accounts for 45% of the entire structure of the interactions within the G7 system. We also find that the pairwise interactions become increasingly inadequate in capturing the synchronization as the size of economic system grows. Thus, higher-order interactions must be taken into account when investigating behaviors of large economic systems.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2014, Elsevier B.V. All rights reserved. This is an author produced version of a paper published in Physica A: Statistical Mechanics and its Applications. Uploaded in accordance with the publisher's self-archiving policy. |
Keywords: | Business cycle synchronization; Interaction network; Ising model; Maximum entropy |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Engineering & Physical Sciences (Leeds) > School of Mathematics (Leeds) > Applied Mathematics (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 27 Jul 2015 09:01 |
Last Modified: | 21 Jan 2018 20:48 |
Published Version: | http://dx.doi.org/10.1016/j.physa.2014.07.005 |
Status: | Published |
Publisher: | Elsevier |
Identification Number: | 10.1016/j.physa.2014.07.005 |
Related URLs: | |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:85045 |