2007/16 | LEM Working Paper Series | |
International Trade and Financial Integration: A Weighted Network Analysis |
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Giorgio Fagiolo, Javier Reyes, Stefano Schiavo |
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Keywords | ||
International Trade, International Financial Flows, Globalization, Complex
Weighted Networks, Dynamics
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JEL Classifications | ||
F10, F36, F40, G15
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Abstract | ||
In this paper we compare the patterns of trade and financial integration by exploit-
ing network analysis. Our results show that, by combining binary and weighted
network analysis, it is possible to deliver more precise and thorough insights on the
topological structure and properties of the international trade and financial net-
works (ITN and IFN). We find that the ITN is more densely connected than the
IFN and that the degree of international financial integration varies with asset type.
Our results also indicate that richer countries are better linked and form groups of
tightly interconnected nodes. This can be seen as a sign of the persistent relevance
of local relations. Yet, the growing importance of global links is testified by the
disassortative feature of both the ITN and the IFN: poorly connected nodes tend
to connect to central ones and use them as hubs to access the rest of the network.
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