Contains practice codes for Paper1
-links between nodes reflect credit or equity relationships and netwrok is directed newnetwork: - test data to test the working of the code; change the first line to link to other codes. entrpy :- entropy is the function of probabilty distribution and is a measure ofthe predeictibilty of exposures. implemented maximum entropy pordecure using the algorithm provided by Mohammad Djafari(1991) [http://arxiv.org/pdf/physics/0111126.pdf] using the above paper; following codes were extracted- fin1_x.m; fin3_x.m; me_dens1.m; me_dens2.m; me_dens3.m; ME3.m; ME2.m; ME1.m running ME1.m ME2.m and ME3.m calls other functions.
Connections b/w banks- To obtain the maximum entropy distribution for the number of links that a bank has against other banks, using the results of Bianconi (2009) that for uncorrelated networks, the maximum entropy distribution for the number of links is a Poisson distribution. Uncorrelated networks are those where the degrees of nodes are not correlated. for international banks Watts and Strogatz(1998) small world algorithm is adopted