BOOLEAN DELAY EQUATIONS ON NETWORKS IN ECONOMICS AND THE GEOSCIENCES

Abstract

We study damage propagation in networks, with an emphasis on production-chain models. The models are formulated as systems of Boolean delay equations. This formalism helps take into account the complexity of the interactions between firms; it turns out to be well adapted to investigating propagation of an initial damage due to a climatic or other natural disaster. We consider in detail the effects of distinct delays and forcing, which represent external intervention to prevent economic collapse. We also account for the possible presence of randomness in the links and the delays. The paper concentrates on two different network structures, periodic and random, respectively; their study allows one to understand the effects of multiple, concurrent production paths, and the role played by the network topology in damage propagation. Applications to the recent network modeling of climate variability are discussed.