Real Implications of Quantitative Easing in the Euro Area: A Complex-Network Perspective

  • Chiara PerilloEmail author
  • Stefano Battiston
Conference paper
Part of the Studies in Computational Intelligence book series (SCI, volume 689)


The long-lasting socio-economic impact of the global financial crisis has questioned the adequacy of traditional tools in explaining periods of financial distress as well as the adequacy of the existing policy response. In particular, the effect of complex interconnections among financial institutions on financial stability has been widely recognized. A recent debate focused on the effects of unconventional policies aimed at achieving both price and financial stability. In particular, Quantitative Easing (QE, i.e., the large-scale asset purchase programme conducted by a central bank upon the creation of new money) has been recently implemented by the European Central Bank (ECB). In this context, two questions deserve more attention in the literature. First, to what extent, by injecting liquidity, the QE may alter the bank-firm lending level and stimulate the real economy. Second, to what extent, the QE may also alter the pattern of intra-financial exposures among financial actors (including banks, investment funds, insurance corporations and pension funds) and what are the implications in terms of financial stability. Here, we address these two questions by developing a methodology to map the macro-network of financial exposures among institutional sectors across financial instruments (i.e., equity, bonds and loans) and we illustrate our approach on recently available data (i.e., data on loans and private and public securities purchased within the QE). We then test the effect of the implementation of ECB’s QE on the time evolution of the financial linkages in the macro-network of the euro area as well as the effect on macroeconomic variables, such as output and prices.



This work has been supported by the research project BigDataFinance. BigDataFinance project has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No. 675044.


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Copyright information

© Springer International Publishing AG 2018

Authors and Affiliations

  1. 1.Department of Banking and FinanceUniversity of ZurichZurichSwitzerland

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