A1453
Title: The Abelian sandpile model in financial crises
Authors: Wayne Tarrant - Rose-Hulman Institute of Technology (United States) [presenting]
Abstract: The situation of bank failure is modelled using the Abelian sandpile model from mathematical physics. The model leads to the situation of self-organized criticality, and we find consistent results over a wide range of probability distributions. This gives us a chance to estimate bank failures' natural rate without regulators' intervention. Because of the consistent results, we are able to determine the effectiveness of Central Bank regulation and interventions from countries which publish records of bank failures.
