On The Robustness Of LVPS Based On Complex Network Theory

In the global financial crisis of2008, the economy of all countries in the world had suffered a hit. The emergence of the financial crisis would make people think about the safety of the whole financial system. To deal with the financial crisis, a central element of the international regulatory policy is to strengthen the financial supervision that is oriented to the macro prudence. Compared with the micro prudence, the macro-prudential regulation focuses on the whole financial system, and makes it as a complex network of financial system which mainly inspects the system robustness based on complex network structure. As an important infrastructure of one country’s financial system, the large value payment system has the responsibility of money transfer between banks, treasury management as well as the important channel and the foundation platform of the implementation of central bank’s monetary policy, which is the financial operation of the "blood circulation system". The safety and efficiency of the payment system’s operation has a significant role of the country’s economic development, financial stability, and even the overall situation of social stability. The large value payment system, therefore, is naturally an important part of the macro-prudential regulation.At present, the research for the robustness of the large value payment system is not perfect, and few scholars use complex network theory to study the system robustness, so the relative literature is relatively insufficient. However, the complex network theory has its unique advantages to deal with this topic. Firstly, in terms of the robustness, the topology structure and the internal property is identified after viewing the payment system as a complex network, and this is bound to have an important influence on the robustness of the whole system. Besides, the robustness of only the individual institution is not enough to ensure the stability of the financial system. The interaction coupling between institutions for financial system stability is very important, because the measures to improve health degree could damage the stability of the whole system. Nevertheless, the complex network method exactly has the ability to make the overall analysis rather than the individual analysis. This provides a supplement for the research and provides a new perspective. Therefore, the complex network method is one of the ideal means to analyze the stability of the financial system.In the large value payment system, the participating institutions connect through a payment network. Based on this connection, this paper establishes the complex network model of the large value payment system to analyze its network characteristics and network robustness. The results show that the payment network has strong robustness to the random attacks, but has obvious fragility if confronted with the deliberate attacks. Then, this paper further analyzes the impact on the payment network robustness to bank institutions with different characteristics, and gives some relevant policy suggestions.In this paper, the research content and the framework are as follows: In the first and the second chapter, we provide a theoretical basis of the article. First, It made a simple introduction to complex network theory, including the development and research of complex networks and complex network theory and the basic description of the nature of the indicators of the network structure, such as degree and degree distribution, average path length, clustering coefficient as well as the network’s the whole performance, and the complex network theory research progress and network robustness analysis in the economic network. Finally, we summarize the robustness of the network for the various properties of the network structure on the basis of the previous. It made theoretical support to later in this article. In the third chapter, we research the development of the payment system, and then we made a simple comment for Chinese payment system and Chinese modernized payment system, and particularly the large-value payment system. Then based on the data, we study some simple statistical analysis of China’s large value payment system, and obtain some information and regularity. Chapters IV and Chapters V is the focus of this article, the fourth chapter, we constructed two complex network models. And we discuss the topological properties and network structure measure for complex network theory. Then we give the degree and the degree distribution and the average path length and clustering coefficient characteristics of the two networks. While the comparative analysis of the similarities and differences to pay the amount of network and pay items network structure. In Chapter V, we focus on the robustness analysis of two payments networks. We study the robustness of the network for two ways of random attacks and deliberate attack. Finally, we discuss the impact of the soundness of the payment system for the banking institutions of the different nature, and gives some policy recommendations based on these analyzes.