Study of multinational currency co-movement and exchange rate stability base on network game

摘要

Complex network analysis of the correlation of exchange rate fluctuations shows that the co-movement of global exchange rate fluctuations is a small-world network. Through the income function of currency issuance and circulation, we build a two countries' currency network model, and then extend it to multi-countries model, within the evolution network game simulation method. We find that multi-countries exchange rate co-movement gradually shapes an stabilize exchange rate co-movement region. The more random the currency co-movement relationship among multi-currency countries is, the easier it is to stabilize exchange rate co-movement relationships; and the higher the proportion of investment income to total income is, the easier it is to shape a multi-currency co-movement exchange rate stability relationship.

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