Network Contagion Dynamics in European Banking: A Navier-Stokes Framework for Systemic Risk Assessment
欧洲银行网络传染动态:基于 Navier–Stokes 的系统性风险评估框架
This paper develops a continuous functional framework for analyzing contagion dynamics in financial networks, extending the Navier-Stokes-based approach to network-structured spatial processes. We model financial distress propagation as a diffusion process on weighted networks, deriving a network diffusion equation from first principles that predicts contagion decay depends on the network's algebraic connectivity through the relation $κ= \sqrt{λ_2/D}$, where $λ_2$ is the…