An Introduction to Complex Networks in Climate Finance.

In this perspective, we introduce recent research into the structure and function of complex investor networks supporting sustainability efforts. Using the case of solar, wind and hydro energy technologies, this perspective explores the complexity in low-carbon finance markets, defined as markets that direct capital flows towards low-carbon technologies, using network approaches to study their structure and dynamics. Investors are modeled as nodes which form a network or higher-order network connected by edges representing projects in which joint funding or security-related insurance was provided or other investment-related interaction occurred. We review the literature on investor networks generally, particularly in the case of complex networks, and address areas where these ideas were applied in this emerging field. The complex investor dynamics which emerge from the extant funding scenarios are not well understood. These dynamics have the potential to result in interesting non-linear behaviour, growth, and decline, which can be studied, explained and controlled using the tools of network science.

Shape of shortest paths in random spatial networks.

In the classic model of first-passage percolation, for pairs of vertices separated by a Euclidean distance L, geodesics exhibit deviations from their mean length L that are of order L^{χ}, while the transversal fluctuations, known as wandering, grow as L^{ξ}. We find that when weighting edges directly with their Euclidean span in various spatial network models, we have two distinct classes defined by different exponents ξ=3/5 and χ=1/5, or ξ=7/10 and χ=2/5, depending only on coarse details of the specific connectivity laws used. Also, the travel-time fluctuations are Gaussian, rather than Tracy-Widom, which is rarely seen in first-passage models. The first class contains proximity graphs such as the hard and soft random geometric graph, and the k-nearest neighbor random geometric graphs, where via Monte Carlo simulations we find ξ=0.60±0.01 and χ=0.20±0.01, showing a theoretical minimal wandering. The second class contains graphs based on excluded regions such as ß skeletons and the Delaunay triangulation and are characterized by the values ξ=0.70±0.01 and χ=0.40±0.01, with a nearly theoretically maximal wandering exponent. We also show numerically that the so-called Kardar-Parisi-Zhang (KPZ) relation χ=2ξ-1 is satisfied for all these models. These results shed some light on the Euclidean first-passage process but also raise some theoretical questions about the scaling laws and the derivation of the exponent values and also whether a model can be constructed with maximal wandering, or non-Gaussian travel fluctuations, while embedded in space.

Sparse Power-Law Network Model for Reliable Statistical Predictions Based on Sampled Data.

A projective network model is a model that enables predictions to be made based on a subsample of the network data, with the predictions remaining unchanged if a larger sample is taken into consideration. An exchangeable model is a model that does not depend on the order in which nodes are sampled. Despite a large variety of non-equilibrium (growing) and equilibrium (static) sparse complex network models that are widely used in network science, how to reconcile sparseness (constant average degree) with the desired statistical properties of projectivity and exchangeability is currently an outstanding scientific problem. Here we propose a network process with hidden variables which is projective and can generate sparse power-law networks. Despite the model not being exchangeable, it can be closely related to exchangeable uncorrelated networks as indicated by its information theory characterization and its network entropy. The use of the proposed network process as a null model is here tested on real data, indicating that the model offers a promising avenue for statistical network modelling.