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Information authenticity, spreading willingness and credit risk contagion – A dual-layer network perspective

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  • Qian, Qian
  • Yang, Yang
  • Gu, Jing
  • Feng, Hairong

Abstract

The spreading of information related to enterprise credit risk among entrepreneurs will affect the credit risk contagion among enterprises. As far as the subjectivity and objectivity are concerned, entrepreneurs’ spreading willingness and the authenticity of information will affect information spreading, and then affect the credit risk contagion. Firstly, this paper analyzes the information spreading path among entrepreneurs and the influence path to credit risk contagion theoretically. Secondly, from the perspective of complex network, a dual-layer network of entrepreneur social relationship–enterprise association is constructed, and an SIR-SIR model is built to reveal interactive between the information spreading and credit risk contagion. Finally, the sensitivity of some parameters is analyzed. The results show that: (1) the contagion threshold of credit risk is related to the authenticity of information and the spreading willingness of entrepreneurs (2) the social rate of entrepreneurs (the probability of social relationship between entrepreneurs) and the similarity of dual-layer network (the proportion of relationships exists between enterprises and entrepreneurs at same time) will affect credit risk contagion. Based on the research results, we propose effective strategies to restrain credit risk contagion: (1) we can suppress the credit risk contagion by improving the authenticity of risk information; (2) when the authenticity of risk information is high, increasing the spreading willingness of entrepreneurs and the similarity rate of dual-layer network can also control the credit risk contagion.

Suggested Citation

  • Qian, Qian & Yang, Yang & Gu, Jing & Feng, Hairong, 2019. "Information authenticity, spreading willingness and credit risk contagion – A dual-layer network perspective," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 536(C).
    • Handle: RePEc:eee:phsmap:v:536:y:2019:i:c:s0378437119314438
    DOI: 10.1016/j.physa.2019.122519
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