Abstract
The worldwide financial crisis (WFC) of 2007-09 has shown the importance of cross-sectional dependencies of assets, credit exposures and volatility, which can threaten domestic and global financial stability through cascades in financial networks. A correct assessment of company-specific risk has to account for the potential risk spillover effects from other firms (Hautsch et al. 2014). This is because of the intertwined nature of financial markets, which allow the spread of risk throughout the system (Acemoglu et al., 2015). The potential impact of interconnected financial institutions on the entire financial system has been a financial stability concern for central banks and regulators. The need for economic foundations for a systemic risk measure is more than an academic concern since it involves regulators, supervisory authorities and policy-makers (Acharya et al. 2017). This special issue provides a substantial contribution to the systemic risk literature
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