The origin of asymmetric behavior of money flow in the business firm network

Miura, Wataru; Takayasu, Hideki; Takayasu, Misako

doi:10.1140/epjst/e2012-01654-7

Cited by 9 publications

(7 citation statements)

References 18 publications

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“…In its original meaning, a node with a high authority value is pointed to by many other nodes with high hub values, and a node with a high hub value points to many nodes with high authority values. This algorithm has been used as a tool for the characterization of the network structure of homepages, and it has been applied to various economic areas, such as the analysis of money-flow networks among Japanese business firms [23] , [24] . Using the – trade dataset compiled by the United States' National Bureau of Economic Research (NBER), Wei and Liu concluded that the “impact ranking” (equivalent to authority ranking) of the United States was decreasing and that the influence of China and Japan was increasing up to [20] .…”

Section: Introductionmentioning

confidence: 99%

Hubs and Authorities in the World Trade Network Using a Weighted HITS Algorithm

et al. 2014

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We investigate the economic hubs and authorities of the world trade network (WTN) from to , an era of rapid economic globalization. Using a well-defined weighted hyperlink-induced topic search (HITS) algorithm, we can calculate the values of the weighted HITS hub and authority for each country in a conjugate way. In the context of the WTN, authority values are large for countries with significant imports from large hub countries, and hub values are large for countries with significant exports to high-authority countries. The United States was the largest economic authority in the WTN from to . The authority value of the United States has declined since , and China has now become the largest hub in the WTN. At the same time, China's authority value has grown as China is transforming itself from the “factory of the world” to the “market of the world.” European countries show a tendency to trade mostly within the European Union, which has decreased Europe's hub and authority values. Japan's authority value has increased slowly, while its hub value has declined. These changes are consistent with Japan's transition from being an export-driven economy in its high economic growth era in the latter half of the twentieth century to being a more mature, economically balanced nation.

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Section: Introductionmentioning

confidence: 99%

Hubs and Authorities in the World Trade Network Using a Weighted HITS Algorithm

et al. 2014

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“…In a previous study, Miura et al [3] obtained power laws of the in-and out-degree distributions, with exponents of 1.3. In our network, we were able to confirm a similar finding of 1 − α = 2.3, i.e a negative exponent α = −1.3.…”

Section: In-degree Distributionmentioning

confidence: 99%

“…In this sector the growth response is opposite to the situation in sector G: there's a large variability in the expected growth of customer orders but the recorded growth of supplier Sales shows very little deviation from a state of no-growth. The atypical in-degree distribution in the Construction industry is discussed in Miura et al [3]. In the Japanese industrial business network, they ran a flow algorithm and observed a difference between in-degree and the ability to source or receive money.…”

Section: Sectoral Differencesmentioning

confidence: 99%

“…Academic research on inter-firm trade credit networks is still in its infancy, as the data on trade-credit transactions is not easily accessible. An exception is the analysis of the trade credit network of Japanese firms, which have been rather extensively characterized by, for example, Tamura et al [2], Miura et al [3] and Watanabe et al [4].…”

Section: Introductionmentioning

confidence: 99%

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Many-to-one contagion of economic growth rate across trade credit network of firms

Golo¹,

Kelman²,

Brée³

et al. 2015

Preprint

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We propose a novel approach and an empirical procedure to test direct contagion of growth rate in a trade credit network of firms. Our hypotheses are that the use of trade credit contributes to contagion (from many customers to a single supplier -"many to one" contagion) and amplification (through their interaction with the macrocopic variables, such as interest rate) of growth rate. In this paper we test the contagion hypothesis, measuring empirically the mesoscopic "many-to-one" effect. The effect of amplification has been dealt with in our paper [1].Our empirical analysis is based on the delayed payments between trading partners across many different industrial sectors, intermediated by a large Italian bank during the year 2007. The data is used to create a weighted and directed trade credit network. Assuming that the linkages are static, we look at the dynamics of the nodes/firms. On the ratio of the 2007 trade credit in Sales and Purchases items on the profit and loss statements, we estimate the trade credit in 2006 and 2008.Applying the "many to one" approach we compare such predicted growth of trade (demand) aggregated per supplier, and compare it with the real growth of Sales of the supplier. We analyze the correlation of these two growth rates over two yearly periods, 2007/2006 and 2008/2007, and in this way we test our contagion hypotheses. We could not find strong correlations between the predicted and the actual growth rates. We provide an evidence of contagion only in restricted sub-groups of our network, and not in the whole network. We do find a strong macroscopic effect of the crisis, indicated by a coincident negative drift in the growth of sales of nearly all the firms in our sample.

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“…In a previous study, we analysed the empirical data from an inter-firm trading network, which consisted of approximately one million Japanese firms, and the sales of these firms (a sale corresponds to the total in-flow into a node) to investigate the actual transport phenomenon in a complex network [13]. This inter-firm trading network is known to be a typical complex network with a power law degree distribution [13,14], a negative degree-degree correlation [13,15], a small world property [14], community structures [16], power laws of money flows [15,17] and an asymmetric behaviour of authorities and hubs explained by a network-evolution model based on the preferential attachment rule [18,19]. To be more precise, we obtained the following results from Ref.…”

Section: Introductionmentioning

confidence: 99%

Mean Field Approximation for Biased Diffusion on Japanese Inter-Firm Trading Network

Watanabe

2014

PLoS ONE

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By analysing the financial data of firms across Japan, a nonlinear power law with an exponent of 1.3 was observed between the number of business partners (i.e. the degree of the inter-firm trading network) and sales. In a previous study using numerical simulations, we found that this scaling can be explained by both the money-transport model, where a firm (i.e. customer) distributes money to its out-edges (suppliers) in proportion to the in-degree of destinations, and by the correlations among the Japanese inter-firm trading network. However, in this previous study, we could not specifically identify what types of structure properties (or correlations) of the network determine the 1.3 exponent. In the present study, we more clearly elucidate the relationship between this nonlinear scaling and the network structure by applying mean-field approximation of the diffusion in a complex network to this money-transport model. Using theoretical analysis, we obtained the mean-field solution of the model and found that, in the case of the Japanese firms, the scaling exponent of 1.3 can be determined from the power law of the average degree of the nearest neighbours of the network with an exponent of −0.7.

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The origin of asymmetric behavior of money flow in the business firm network

Cited by 9 publications

References 18 publications

Hubs and Authorities in the World Trade Network Using a Weighted HITS Algorithm

Hubs and Authorities in the World Trade Network Using a Weighted HITS Algorithm

Many-to-one contagion of economic growth rate across trade credit network of firms

Mean Field Approximation for Biased Diffusion on Japanese Inter-Firm Trading Network

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