Disentangling bipartite and core-periphery structure in financial networks

Bipartite networks are a common type of network data in which there are two types of vertices, and only vertices of different types can be connected. While bipartite networks exhibit community structure like their unipartite counterparts, existing approaches to bipartite community detection have drawbacks, including implicit parameter choices, loss of information through one-mode projections, and lack of interpretability. Here we solve the community detection problem for bipa...

In this paper, we focus on learning sparse graphs with a core-periphery structure. We propose a generative model for data associated with core-periphery structured networks to model the dependence of node attributes on core scores of the nodes of a graph through a latent graph structure. Using the proposed model, we jointly infer a sparse graph and nodal core scores that induce dense (sparse) connections in core (respectively, peripheral) parts of the network. Numerical exper...

We propose a generalized stochastic block model to explore the mesoscopic structures in signed networks by grouping vertices that exhibit similar positive and negative connection profiles into the same cluster. In this model, the group memberships are viewed as hidden or unobserved quantities, and the connection patterns between groups are explicitly characterized by two block matrices, one for positive links and the other for negative links. By fitting the model to the obser...

In recent years, methods from network science are gaining rapidly interest in economics and finance. A reason for this is that in a globalized world the interconnectedness among economic and financial entities are crucial to understand and networks provide a natural framework for representing and studying such systems. In this paper, we are surveying the use of networks and network-based methods for studying economy related questions. We start with a brief overview of graph t...

We study core-periphery structure in networks using inference methods based on a flexible network model that allows for traditional onion-like cores within cores, but also for hierarchical tree-like structures and more general non-nested types of structure. We propose an efficient Monte Carlo scheme for fitting the model to observed networks and report results for a selection of real-world data sets. Among other things, we observe an empirical distinction between networks sho...

Community detection is an important task in network analysis, in which we aim to learn a network partition that groups together vertices with similar community-level connectivity patterns. By finding such groups of vertices with similar structural roles, we extract a compact representation of the network's large-scale structure, which can facilitate its scientific interpretation and the prediction of unknown or future interactions. Popular approaches, including the stochastic...

We consider community detection in Degree-Corrected Stochastic Block Models (DC-SBM). We propose a spectral clustering algorithm based on a suitably normalized adjacency matrix. We show that this algorithm consistently recovers the block-membership of all but a vanishing fraction of nodes, in the regime where the lowest degree is of order log$(n)$ or higher. Recovery succeeds even for very heterogeneous degree-distributions. The used algorithm does not rely on parameters as i...

A nonparametric approach to the modeling of social networks using degree-corrected stochastic blockmodels is proposed. The model for static network consists of a stochastic blockmodel using a probit regression formulation and popularity parameters are incorporated to account for degree heterogeneity. Dirichlet processes are used to detect community structure as well as induce clustering in the popularity parameters. This approach is flexible yet parsimonious as it allows the ...

Community detection for large networks is a challenging task due to the high computational cost as well as the heterogeneous community structure. Stochastic block model (SBM) is a popular model to analyze community structure where nodes belonging to the same communities are connected with equal probability. Modularity optimization methods provide a fast and effective way for community detection under SBM with assortative community structure, where nodes within communities are...

To capture the systemic complexity of international financial systems, network data is an important prerequisite. However, dyadic data is often not available, raising the need for methods that allow for reconstructing networks based on limited information. In this paper, we are reviewing different methods that are designed for the estimation of matrices from their marginals and potentially exogenous information. This includes a general discussion of the available methodology ...